The textile ministry has also decided to raise the ceiling on cotton yarn exports from 200 million kilogram to 300 million kg for the calendar year 1999. Restrictions on export of cotton waste by 100 per cent EOUs and exempt deemed exports from Hank Yarn Obligation has also been removed.

The decisions were taken by the textile minister on Tuesday subsequent to the meeting of the empowered committee which has representatives from ministry of commerce, department of industrial promotion and policy and ministry of agriculture.

The industry, however, is disappointed with the fact that the ministry has ignored its plea to make the relaxation granted to the EPCG units and the 100 per cent EOUs permanent instead of pegging it to December 31.

Speaking to TheFinancial Express, KJS Ahluwalia, secretary, Northern India Textile Mills' Association (NITMA) said that with competition in the international market intensifying due to devaluation in the currencies of south-east Asian countries, there was no point in continuing with such restrictions. "If a mill is forced to import cotton there is unnecessary increase in costs. Such moves take away the Indian mills' competitive edge."

After struggling for the major part of the last fiscal due to the south-east Asian crisis, cotton yarn exports started moving upwards since April. During the first month of the current financial year exports of cotton yarn grew by 9.5 per cent. In value terms, exports in April'99 were recorded at Rs 586.39 crore as against Rs 535.55 crore during the same period last year.

The decisions taken by the textile ministry is expected to give a further boost to textile and yarn exports. The ministry would be asking the textile commission to amend its notification dated March 20, 1995 in thisregard.