World cotton production declined by 5.7 per cent to 24.7 million tonnes in 2005-06. As against this, the world consumption was projected to rise by 7.4 per cent to 25.5 million tonnes (up 1.7 million tonnes over last year). Obviously, as the consumption would exceed the production, the market forces would be favourable to the cotton producers. However, what should worry the cotton producers is that the yield that declined from 732 kg per ha in 2004-05 to 712 kg per ha in 2005-06. This gives rise to a strange situation where declining yield means a decreasing realization for the farmers and on the other hand declining production means declining availability of cotton to the processors like spinners! This creates a situation like between devil and a deep sea. This has made many governments including China to introduce a system to encourage employment and to improve living standards in rural areas by guaranteeing minimum prices above the international price level. This solution also however is not without its own pitfalls, as the country like United States stretch this logic to the ultimate end subsidizing the agriculture in such a manner that the single issue of US agriculture subsidies could rock the boat of Dhoha Development Round. These subsidies hurt developing country farmers as they lead to higher output and lower global prices. In fact, the Bush administration in the US which is tom-toming from the roof top about the free markets in the world has actually almost doubled the level of agricultural subsidies in their own country. The issue of subsidies provided to cotton by the US domestically is a case in point. The United States is the world's largest cotton exporter. It should be pertinent to know however that some 25000 rich American cotton farmers share between them US $ 3-4 billion in subsidies!! This in Rupee term would mean each one of them gets average Rs.72.0 lakh by way of subsidy. Obviously, this cuts both ways. The increased supply in the world market of the American cotton h elps depressing the prices and under cutting of the prices by the American exporters because of the fat subsidies given by the government also under cuts the prices. If we talk of the poorest, then the increased supply depressing the cotton prices hurts some ten million farmers in sub-Saharan Africa alone! Think of farmers in Maharashtra and Karnataka committing suicide. One doesn't has to go far to understand the reason as India is the third largest producer of cotton in the world. Out of total produced production of 24.7 million tonnes in 2005-06 China contributed 5.7 million tonnes followed by United States 5.2 million tonnes India 4.0 million tonnes, Pakistan 2.10 million tonnes, Uzbekistan 1.20 million, Brazil, 1.0, Turkey 0.8, Australia 0.6 and Greece 0.4 million tonnes amongst the major producers. What should worry Indian farmers however is the yield per hectare. If we look at these figures, India stands at the bottom with Australia (1826), Turkey (1288), Greece (1211), Brazil (1204), China (1119), U S (938), Uzbekistan (841), Pakistan (674) and world average of 712 kg per hectare leading Indian average of 450 kg per hectare by miles and furlongs. Even if we go by the average yield available from the textile Commissioner of 469.49 hectares given elsewhere in this issue it does not get us far.

It is in this context, India should look at the cotton production and subsequent opportunities for the processors of Indian cotton.

When we talk of the processors, cotton yarn is one of the major products which is going to be in the demand. The increase in the demand for the cotton cloth and subsequent increase of the same in production has pushed up the demand for the cotton yarn. The cotton yarn production thus grew at 5.5 per cent during the year 2005 compared with just 2.7 per cent increase in the production of synthetic yarns. India produced 22.48 lakh tonnes (2.248 million tonnes) cotton yarn in 2005. The projections for the year 2006 and 2007 are 25.16 lakh tonnes and 25.87 lakh tonnes, respectively against the production of cotton for the year 2004-05 of 24.3 million bales (one bale equals 170 kg) and 2005-06 marginally higher at 24.40 million bales. Even at slightly better estimate for the current year India could never touch anywhere closer to the Chinese cotton yarn production of 121.45 lakh tonnes in 2005 and the projected production of 126.59 lakh tonne and 132.61 lakh tonne respectively for the years 20 06 and 2007. This will be roughly half the production of the cotton yarn in the entire world.

If we talk about cotton fabric the world production of cotton fabric jumped to 14 million tonne with a growth of 7.5 per cent in 2005 compared to 13 million tonne in the previous year. Pakistan recorded the highest increase (0.48 million tonne) followed by China (0.37 million tonne), India (0.327 million tonne) and Turkey (23000 tonne). There is also increasing awareness about organic cotton and cotton fabric processed with organic dyes. The issue is how best India could take advantage of the emerging scenario. Though China is the top producer of cotton and accounts for half the production of cotton yarn, China imports cotton and cotton yarn to further convert it into the value added products. Shall we question ourselves that how far we are justifying in priding ourselves seeing the photographs in the press of the Chinese flocking our markets to procure cotton. India shall have to learn to get into more and more value added products. This only can afford better prices to our farmers and better position for the Indian textile industry in the world market. It is a long way to go. We have somehow learnt to be the mediocrities. On one hand our farmers commit suicide because they do not get proper realization of their crops. May be they need to improve upon the technology and adopt to more efficient way of farming. But then if the governments are half the sensitive then what they should be it is the time the Textile Ministry puts the heads together to work out a long term strategy to promote the production of value added cotton textiles and other production in this country. The option is between the short term solutions like populistic measures like support prices and ministerial visits making a show of sympathy and getting down to a serious business to achieve a long term advantage both for the Indian farmers as well as the textile industry. It requires a determination, commitment and above all the pride as a country to lead. I devote this issue to those who have been bestowed upon with the authority to plan and implement with right kind of a mind to think.