Differential with a Difference

Foreign Trade Minister, L N Mishra, to move the Cotton Corporation to enter the market. True, the Reserve Bank did go through the motions of tinkering with the margins on bank advances against cotton. But in the face of the continuing power shortage this predictably had little impact on purchases by traders and mills. Gujarat's demand' for bulk purchase of cotton by CCI is difficult to resist considering that for the last four years the Food Corporation has been subsidising the wheat growers of Punjab, Haryana and UP in the face of the repeated recommendations of the Agricultural Prices Commission to lower wheat procurement prices. As it is, the belated entry of the CCI is likely to help mainly the large growers who could wait, whereas the small ones have already .sold their cotton at distress prices. The large growers and the inter- nv diaries are now organising to extract the maximum benefit out of the CCl's entry. The CCI wants to have 1969 prices as the floor, but the growers want at least 25 per cent more on the ground that use of the high-yielding varieties has raised costs by one-fourth compared to 1969.