COTTON FARMERS

NEWS: India could import raw cotton from the U.S., process it into cloth domestically, and export finished products — possibly under zero reciprocal tariff arrangements triggered protests from cotton farmers across India, who fear that cheap imports of U.S. cotton will crash domestic cotton prices

Cotton Farmers Protesting

• Fear of Price Crash: cheap U.S. cotton enters Indian marketsàDomestic cotton demand may fall, prices may decline further
• Farmer Indebtedness & Agrarian Crisisà Further price decline may increase rural indebtedness, risk of farmer suicides
• MSP vs Market Realityà MSP (as per M.S. Swaminathan formula) should be ~₹10,075/quintal but actual MSP fixed: ~₹7,710/quintal

Industry vs Farmers Conflict

Textile Industry View (Implicit)

• Cheap imported cotton = lower input cost
• Boost to exports
• Higher competitiveness in global textile market

Farmers’ View

• Dumping of cheap cotton harms domestic cultivation
• Threat to livelihood security
• Decline in domestic cotton ecosystem

This is a classic producer vs processor conflict.

Strategic Economic Implications

• Self-Reliance vs Trade Liberalisation: Importing raw cotton may weaken Atmanirbhar Bharat in agriculture
• FTAs and zero-duty imports may harm agriculture
• Cotton Value Chain: Farmer → Raw Cotton → Textile Industry → Garments → Exports
  • If raw cotton is imported–> farmers lose market share

India’s Position:

• One of the largest cotton producers in the world
• Major cotton-growing states: Maharashtra (largest), Gujarat, Telangana, Punjab, Haryana

Importance:

• Supports textile industry (second-largest employer after agriculture)
• Key export commodity
• Rural livelihood backbone