CCI grants subsidy to Maharashtra spinning mills

The Cotton Corporation of India (CCI) has granted a subsidy of Rs 300 per candy to cooperative spinning mills in Maharashtra. The Corporation has also waived-off the security deposit of `2 lakh that the mills have to pay before participating in the e-auction process of the cotton body. The mills, however, say that this is not enough and have demanded a subsidy of Rs 2,500 per candy.

CCI is currently selling cotton at Rs 47,000 per candy and with transportation charges, it costs mills around Rs 48,000 per candy which is not affordable. Imported cotton attracts a duty of 10 per cent which again is not affordable for mills Cooperative spinning mills are not able to afford these rates and have therefore sought a subsidy of Rs 2,500 per candy.

Of the total of 150 cooperative spinning mills in the state, only 70 mills are currently functional with an installed capacity of 14 lakh spindles daily. The annual cotton requirement is around 12-13 lakh bales and the sales turnover are Rs 2,500 crore annually. The state government has invested Rs 2,500 crore in these mills as shares capital. These mills give revenues to both the central and state government in the form of various taxes of Rs 200 crore to Rs 250 crore annually.

Both the CCI and the state government have agreed to forward the demand of spinning mills for more subsidy to the Centre.