Eight textile industry associations in India are demanding a relaxation of cabotage to help cut costs in transporting cotton from Gujarat to Tamil Nadu. This would help save hundreds of crores of rupees. Almost 50 per cent of the cotton used for textile manufacturing in Tamil Nadu is purchased from Gujarat. And the transit of cotton is done through three modes: rail, road and water.

Transit by seas is difficult because there are not enough Indian containers that carry the goods in the ship. By ship it takes 25 days for the cotton to reach mills, while mills have to pay ginners within 21 days. This forces them to transport cotton by road most often.

According to law, an Indian vessel will be given first preference for transport of goods from one port to another within the country. Only if an Indian vessel is unavailable, will a foreign vessel be allowed to transport the goods after receiving the license from India’s maritime regulator.

If the cabotage laws are relaxed, the industry would save almost Rs 250 a bale. Tamil Nadu purchases 70,00,000 bales from Gujarat every year. Relaxation would help the industry save about Rs 175 crores.