The request letter was officially handed over by the chief minister, Manohar Joshi to the visiting union textile minister Kashiram Rana on Thursday (April 16).

Though Rana was non-committal on the issue, the state textile minister Jaiprakash Mundada told The Financial Express that he hoped the centre will give its nod to protect the interest of cotton growers in Maharashtra. "A two-year extension was given by AB Vajpayee during his 13-day rule in 1996 and we sincerely hope to get a positive reply from the centre now," he added.

The CMPS which was introduced from 1972-73 season under the Raw Cotton (Procurement, Processing and Marketing) Act, 1971 was initially opposed by cotton growers. Initially, the Act was in force for eight years andrenewed from time to time. The centre has extended the Act up to June 30, 1998 and thus a fresh appeal for the extension has been made.

The scheme has been implemented by the Maharashtra Cooperative Cotton Growers' Marketing Federation with an objective to give a fair price to the cultivators, remove defects in the marketing system and keep away intermediaries. The attempt was also made to ensure supply of unadulterated and pure cotton at reasonable price to the consumer mills and uplift economy, boost cotton production and develop a cooperative cult.

According to Mundada, the cotton growers have been in favour of the continuation of CMPS in the state despite the ongoing liberalisation policies. "It is not the monopoly of government but of cotton growers," he added.

Maharashtra continues to be a leading producer of cotton and accounts for 20 per cent of the total production. The area under cotton cultivation has rose to 30 lakh hectares, which is 30 per cent of the total area under the cotton productionin the country.

Before the launch of this scheme, cotton was auctioned locally and the cultivator was deprived of a fair price due malpractice by middlemen and brokers.

Under the scheme, government declares guaranteed price payable to the cultivators and attempts were made to make 100-per cent payment to the cultivators at the time of tendering the cotton. The procurement for the 1997-98 will be around 66 lakh quintals in view of likely fall in the cotton production due to unseasonable rains and hailstorms. Though initially the cotton production was estimated at 175 lakh quintal, it would be mere 75 lakh quintals now.

The Federation has paid over Rs 1,100 crore to the cotton growers after the procurement of 55 lakh cotton. However, the Federation's attempt to export 75,000 bales sanctioned by the centre failed as there were no takers due to the steep fall in prices at global markets. The Federation has exported about three lakh bales last year.

The Federation has made this payment without approachingthe government but raised it through internal resources (Rs 457 crore), Mumbai Metropolitan Region Development Authority (Rs 200 crore) and urban cooperative banks (Rs 300 crore). The Federation has also sought funds from the Apex Co-operative Bank for Maharashtra and Goa (set up in 1996) -- Rs 300 crore, and Maharashtra State Cooperative Bank (Rs 800 crore).

Taking into consideration the peculiar situation of 1997-1998 cotton season and bowing to the pressure from Shetkari Sanghatana led by Sharad Joshi, the government has taken a decision to pay the entire amount in one single installment at the time of purchasing.

Further, the ruling alliance had reduced the cotton grades (for procurement under its special scheme) from five to two. The new grades were the fair average quality (FAQ) and Kawadi. The revised FAQ included old super, FAQ and fair grades while Kawadi has old Kawadi and X grades.

According to this revised grading system, FAQ grade received the price of super grade of that variety andKawadi grade got price of old X grade. These revised prices ranged from Rs 1,810 to Rs 2,150 for FAQ and Rs 950 for Kawadi grade.

The shortfall in the implementation of CMPS has been Rs 160 crore in 1994-95 to Rs 500 crore in 1995-96 and Rs 377 crore in 1996-97. However, despite this, the state government has resolved to implement the scheme.