Impact of Wto on the Production and Export of Indian Cotton An Econometric Analysis

Abstract

The present study aims at analyzing impact of WTO on cotton production and export newlinein India. The study estimated the growth rates and instability in area, production and newlineproductivity of cotton. The impact of WTO on the direction of exports, factors affecting the newlineexport and constraints involved in the exports were also examined. The time series data on newlineproduction, area yield and exports were collected for a period from 1985-86 to 2008-09. The newlinestudy period was divided into pre-WTO period (1985-86 to 1994-95) and post-WTO period newline(1995-96 to 2008-09). The study revealed that during the post-WTO period there was positive newlinegrowth in the area, production of cotton. The districtwise analysis in Karnataka showed that newlineonly Gulbarga district recorded positive growth in area, production and productivity of cotton. newlineThe change in the mean yield was the main contributor to the change in the average newlineproduction of cotton in the country and Maharashtra was the highest contributor. The yield newlinevariance was the major source of change. In case of Karnataka, the change in mean area newlinewas the major contributor wherein Bellary and Raichur contributed significantly. The exports newlineof cotton showed significant increase in all staple wise exports during the post-WTO period. newlineAmong the different staple lengths of cotton exported the major share was from the long and newlineextra long staple (49%). The destination wise exports revealed that during the pre-WTO newlineperiod the highest share of exports from India was to Japan. But during the post-WTO period newlineJapan, UK and Germany showed negative growth in quantity of cotton exports from India. newlineThe quantity of exports witnessed higher instability of 133.62 per cent. During the post-WTO newlineperiod China was the major importer (45.86%) followed by Pakistan (13.50%) and Japan, newlineChina, Pakistan Thailand were the stable markets of Indian cotton. The export demand for newlinecotton was found to increase with domestic production. Poor awareness among the farmers newlineespecially with respect to packing material and the presence of high trash/