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The union ministry of shipping has relaxed the cabotage rule for transportation of cotton along with several other products by issuing a ‘General Order’. The move would help textile mills to cut transportation costs, industry officials said. Transporting cotton through ships would cost mills Rs 550-650 per bale (a bale is 170 kgs). In contrast, road transportation charges work out to Rs 750-850 per bale. Cotton is now being almost entirely transported through road from Gujarat, the largest producer of the crop in the country, to TN. Cabotage is the transport of goods between two places in the same country by a transport operator from another country. Foreign flag vessels would be in a position to offer a competitive rate as large number of empty foreign containers are being transported between the ports in Gujarat and Tamil Nadu, said P Nataraj, chairman, Southern India Mills’ Association (SIMA). “This initiative would greatly benefit cotton farmers in Gujarat and the spinning mills in Tamil Nadu,” he said. TN produces only 5-6 lakh bales of cotton per year against its annual requirement of nearly 130 lakh bales. Textile mills in the state procure nearly 60 lakh bales of cotton from Gujarat, the largest producer of the crop in the country. The textile industry here has been demanding relaxation of cabotage rule for transporting cotton from ports in Gujarat to ports in Tamil Nadu and use foreign flag vessels to carry the cotton.
For the original version including any supplementary images or video, visit https://timesofindia.indiatimes.com/business/india-business/cabotage-rule-relaxation-to-cut-cotton-transportation-cost-for-textile-industry/articleshow/64310659.cms
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