Maharashtra government nods loan guarantee for cotton union

0

The state cabinet on Wednesday approved a proposal to guarantee the loan of Rs 1,500 billion requested by the Maharashtra State Cooperative Cotton Growers Marketing Federation.

Officials said the state guarantee will be on the Rs 1,500 billion loan that the association will borrow from the Bank of Maharashtra at an interest rate of 6.35 percent per year to make timely payments to farmers when purchasing cotton for the 2020-21 season.

Due to satisfactory rainfall and favorable weather conditions, around 400 lakh quintals of cotton are expected to be produced in the state this season, an official said.

The official added that cotton purchases began last month.

The association has bought around 32 lakh quintals of cotton from farmers, the official said, adding that 93.89 lakh quintals of cotton – valued at Rs 5.023 billion – were purchased from farmers in the 2019-20 season.

The official went on to say that given the drop in cotton prices in international and open markets and the increase in guaranteed prices announced by the Union government this season compared to last season, the association will need to source large quantities of cotton at the guaranteed price.

Leave A Reply

Your email address will not be published.