The decision has been taken after keeping in view the availability of yarn to boost sagging exports of cotton yarn from the country, an official press release said on Tuesday. Restrictions based on use of cotton yarn for the domestic sector and counts were part of the order relaxing exports, it said.

The decision comes on the heels of spinning mills exporting cotton yarn being given exemption from hank yarn obligation, which requires each mill to produce 50 per cent of yarn meant for domestic market in hank form to ensure the handloom sector was not starved of its inputs.

The release said the decision was taken in deference to various representations from the industry to the textiles ministry. Industry had demanded greater operational flexibility to equip themselves better to face the adverse market conditions arising out ofdemand recession in global textiles market.

India's cotton yarn exports has been on the downswing since the beginning of the year on account of meltdown in south-east Asia, which accounts for 45 per cent of the cotton yarn exports.

The release said the decision would give a boost to mills and textile industry besides encouraging investment in setting up integrated units for achieving greater value addition by export of fabrics.

It said exports by EOUs should be within the overall quantitative ceiling of 175 million kg for yarn upto 40s counts. Mills would have to approach the Cotton Textile Export Promotion Council (Texprocil) for export quotas.

For integrated units exporting cotton yarn the relaxation would be subject to the unit being fully installed and certified as a balanced unit of spinning and weaving capacity by the textile commissioner.

The exports would also be not more that shipment of fabrics in value terms. Besides, it would be governed by the letter of undertaking regarding exportobligation, the release added.