An official notification issued in this regard states that the union government has decided to allow exports of cotton yarn in counts up to 40s to non-quota countries within a ceiling of 200 million kg during 1999. Exporters, however, point out that though the ceiling for the previous year was fixed at 175 million kg, actual exports under that ceiling were just around 100.62 million kg. The export policy which expects that these can be raised to 200 millions kg may create a false illusion which can serve little useful purpose. Fresh export business remains very difficult and price realisations have become highly discouraging.

Exporterspoint out in this context that the average unit value realisation in December 1998 was as low as $2.85 per kg compared with $3.40 per kg at the beginning of the year, indicating a sharp drop of about 16.78 per cent in prices.

Overall exports of cotton yarn -- both within and outside the ceiling as well as to quota countries -- were also down by 7.96 per cent in to 473.54 million kg in 1998, compared with 514.47 million kg in the preceding year. That also showed that the overseas markets were far from favourable. Exporters were, therefore, in doubt whether the earlier export level of about 100.62 million kg (within the ceiling) would be maintained in the current year, unless the overseas markets suddenly revive. However such chances looked remote. Exporters further point out that fresh export enquiries remain slow and LoCs were not easily forthcoming even after expression of firm intention to buy. The business environment, therefore, remains discouraging. Cotton yarn of count 30s is being offered around$2.90 to $3.00 per kg, but it is very difficult to attract overseas buyers. According to reports reaching here from Hong Kong, Pakistani cotton yarn of 20s is available there around $2.23 per kg while that of Indian origin is quoted around $2.26 per kg.