CCI buys cotton at MSP as prices drop

Subject: Geography

Section: Socioeconomic geography

Context:

With cotton prices remaining subdued due to lack of demand, the Cotton Corporation of India (CCI) has purchased nearly two lakh bales of cotton at the Minimum Support Price (MSP).

About Cotton Corporation of India

Cotton Corporation of India was established in 1970 under Companies Act 1956.
It’s a Government of India’s corporate agency, engaged in diverse activities related to trade, procurement, and export of cotton.
CCI is governed by the Textile Policy 1985 issued by Ministry of Textiles, Government of India.
CCI operates in the following states as of now – Punjab, Haryana, Rajasthan, Gujarat, Maharastra, Madhya Pradesh, Andhra Pradesh, Karnataka, Tamil Nadu and Orissa.
The major role of the CCI is to undertake price support operations, whenever the market prices of cotton falls below the minimum support prices (MSP).

About Crop Cotton

Cotton is a kharif crop which requires 6 to 8 months to mature. Its time of sowing and harvesting differs in different parts of the country depending upon the climatic conditions.
Cotton is the crop of tropical and sub-tropical areas and requires uniformly high temperature varying between 21°C and 30°C. The growth of cotton is retarded when the temperature falls below 20°C.
Cotton is a drought – resistant crop ideal for arid climates and requires an average annual rainfall of 50- 100 cm.
It requires at least 210 frost free days in a year.
It occupies just 2.1 % of the world’s arable land, yet it meets 27% of the world’s textiles need. In addition to its fibre used in textiles and apparel, food products are also derived from cotton like edible oil and animal feed from the seed.
India is the second largest producer of cotton in the world after China.
Between 2011 and 2018, India implemented a Cotton Technical Assistance Programme (Cotton TAP-I) for seven African countries namely Benin, Burkina Faso, Mali and Chad and also Uganda, Malawi and Nigeria.
The technical assistance focused on improving the competitiveness of the cotton and cotton-based textiles and apparel industry in these countries through a series of interventions which had significant outcomes leading to a demand for a follow on project.