A conversation with Salil Chawla, Director, DFU Publications, and Lalit Kumar Gupta, CMD, Chairman and Managing Director of the Cotton Corporation of India (CCI), discussed CCI’s role in supporting cotton farmers and enhancing efficiency.
CCI’s Network and Role in MSP Operations
Established in 1970, CCI took on its Minimum Support Price (MSP) role in 1985. Today, it operates through a network of 500 procurement centers across 11 cotton-producing states, managed via 17 regional branches. During peak MSP operations, CCI engages over 1,400 mill-pressing factories and employs a workforce of 900, supplemented by temporary staff during the season.
CCI sells its stock—including lint and cottonseed—through an e-auction platform, ensuring transparency and efficiency. Over the last two decades, MSP operations have been shaped by global economic trends, including the U.S. subprime crisis, China's shifting cotton reserve policies, and the impact of COVID-19. In 2023-24, CCI procured 33 lakh bales, accounting for 10% of total production, marking a significant operation.
Global Market Shifts and the Sustainability Challenge
International trade dynamics continue to evolve, with Brazil now leading global cotton exports. Gupta emphasized the growing importance of sustainability in the cotton industry but acknowledged that developing nations like India face significant challenges. Sustainability lacks a universally accepted definition and varies based on regional agricultural landscapes.
For India, where 97% of cotton farmers are small or marginal, traceability remains complex. Ensuring sustainability compliance—whether through soil-based testing or isotopic analysis—is challenging due to widespread cotton mixing and processing. Gupta stressed the need for practical solutions tailored to India’s unique conditions.
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Empowering Farmers Through Technology and Digital Initiatives
CCI has introduced several digital initiatives to enhance farmer engagement and efficiency:
Cotton Provider App: Available in nine regional languages, it informs farmers about MSP rates, procurement centers, and payment tracking while providing an online grievance redressal system.
SMS Alerts for Payments: From the 2023-24 season, farmers receive real-time SMS updates when bills are generated and payments are processed, eliminating the need for bank inquiries.
Aadhaar-Based Registration: Launched in October 2023, this system, along with OTP verification, ensures 100% accurate payments directly to farmers’ accounts. In the last season, ₹12,000 crores were disbursed to 8,000 farmers without a single misdirected payment.
QR Code-Based Traceability: Introduced in October 2023, this allows complete tracking of cotton from farm to buyer, enhancing transparency and accountability.
Paperless Transactions: A Step Towards Efficiency
CCI is set to introduce a fully digital transaction system for buyers, including:
Online payments for heavyweight and seed buyers
Digital invoices, delivery orders, and contract generation
Online ledger access to manage credit balances efficiently
These initiatives mark a major transformation, ensuring end-to-end paperless operations from farmers to buyers, boosting efficiency, and reducing administrative bottlenecks.
Future of Indian Cotton and Sustainability Awareness
Gupta emphasized that sustainability is no longer an option but a necessity. With the Ministry's initiative on Pasturik Cotton, India produced 47% of the world’s supply in its first year, with CCI handling 92% of it.
Looking ahead, continued innovation and government support will be crucial in ensuring that India remains competitive in the global cotton market while embracing sustainability and digital transformation.