The Textile Ministry will try to get export incentives restored for cotton yarn , said Union Textiles Minister K.S. Rao .

The Directorate General of Foreign Trade had in September revoked incentives – a duty credit of 2.5 per cent of Free On Board value for shipments to select countries under the Focus Market Scheme – for the export of cotton yarn on the ground that giving export incentives for a commodity that has export curbs is conflicting.

The Ministry has taken up the issue with the Commerce Ministry to include cotton yarn in the list of export items eligible for incentives, he said at a meeting on Saturday organised by Texprocil. The Minister stopped short of saying when an announcement in this regard can be expected.

The call for incentives comes at a time China is cutting down on yarn imports, forcing exporters to look at other markets such as Japan, South Korea, Vietnam, and Cambodia. The Minister said Japan imports a major portion of its cotton yarn from China, a competitor grappling with rising costs of skilled labour.

Manikam Ramaswami, Chairman, Texprocil, said the industry, reeling under labour shortage, should be quick to absorb farm hands abandoning agriculture in the face of growing mechanisation.