Total cotton yarn exports in 1998 were 474.5 million kg valued at Rs 5,888 crore against a record 515 million kg exports worth Rs 6,070 crore in 1997, a cotton Textiles Export Promotion Council (Texprocil) data said.

It was for the first time in last five years that cotton yarn exports registered a negative growth after having doubled since 1993.

The main reason for the fall in yarn exports was the economic crisis in the south-east Asian region, which accounts for roughly 45 per cent of India's total cotton yarn exports.

Cotton yarn exports to the south-east Asian region had been on the decline since November-December 1997, when the shipments fell by nearly 80 per cent.

However, much ground was made up on the yarn export front during the last quarter of 1998, textile secretary Shyamal Ghosh said.

Cotton yarn exports,which had declined by nearly 18 per cent till September last, increased significantly during the last quarter, he said.

As per Texprocil data, cotton yarn exports during December last were up at 43.84 million kg against 39.85 million kg during December 1997.

Fall in yarn exports has been one of the major worrying factors in India's textile shipments, which account for a little over 30 per cent of the country's total exports.

Ghosh said government took various steps to halt decline of yarn exports.

"We exempted export-oriented units from Hank Yarn Obligations, while relaxed the exports of yarn upto 40s counts," he said. The Hank Yarn Obligations requires mills to produce 50 per cent of the total production for the domestic market in hank yarn form for the handloom sector.

The steps yielded results as the decline in yarn exports was arrested to nine per cent from what it was in September, he said.

Meanwhile, the textile ministry had recommended allowing export of 200 million kg of yarn upto 40scount this year to countries which have quantitative restrictions on yarn imports, ghosh said.

This is against 175 million kg permitted last year. This is for the second consecutive time that government has announced the export allocation annually.

Earlier, the announcement was made only till June and this affected shipments as the quota got exhausted quickly.

The one-time announcement will help continuous exports until the quota is exhausted.