India is the second largest exporter of cotton textiles in the world. Although the percentage share of cotton yarn and cloth in the country’s total exports has declined in recent years, still these form impor­tant items of export. Cotton yarn, twists and cloth constituted 23 percent of the country’s total value of exports in 1950-51, 10.12 per cent in 1960-61 and 7.8 per cent in 1998-99.

The total value of all such exports was Rs. 65 crores in 1960-61 which rose to Rs. 408 crores in 1980-81 and 14,474 crores in 2004- 05. Mill made cloth accounted for 26 per cent, apparel 46 per cent, handloom cloth 12 per cent, power loom cloth 3 per cent and cotton hosiery 3 per cent of the total value of textile exports.

Russia, United Kingdom, the United States, Sudan, Nepal, Australia, France, Nigeria, Kenya, Ediiopia, Tanzania, Sri Lanka and Singapore are the important buyers of Indian cotton fabrics. An agree­ment has been signed with the EEC for providing special status to the Indian cotton manufactures. The Cotton Textile Export Promotion Council helps in promoting export of cotton fabrics besides provid­ing marketing and research facilities. Indian export is facing tough competition from countries like Pa­kistan, Japan and China whose textile goods are cheaper.

Some countries have imposed quota re­strictions which restricts die scope for the increase in exports. For example, the United Kingdom increased 15 per cent import duty on the Indian fabrics in 1972 which was very discouraging for the industry.

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A new Quota Policy has been announced to the textile sector for die period 1.1.2000 to 31.12.2004 which seeks to maintain continuity and stability in exports and prepare die exporters for facing the challenges of the post-quota regime beginning from January 2005. In addition, it aims at better utilization of quotas and discourages ‘trading of quotas’.

Two osier major initiatives viz., Cotton Tech­nology Mission (CTM) and Technology Up gradation Fund Scheme (TUFS) have been proposed. The former has four mini missions, with two dealing with improving productivity and quality of production and the osiers dealing with the problem of minimiz­ing contamination and improving existing ginning and pressing facilities.

The TUF has already come into effect from April 1,1999, The Scheme provides for reimbursement of five percentage points on the interest charged by lending agencies on projects of technology up gradation.

Presently attempts are also being made to diversify cotton textile exports so as to include more blended fabrics and readymade garments which are in great demand. In 1999-2000 the country exported Rs. 20,809 crore worth of readymade garments of all textile materials which constitutes 12.8 per cent of India’s total export earnings.

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There leas been gradual increase in the demand of such garments in Euro­pean and American markets due to propaganda through exhibitions, fashion shows and beauty con­tests.