The March 5 ban on cotton exports had been enforced after shipments crossed 8.4 million bales (170 kg each), the official estimate of exportable surplus, leading to suspicions that the produce was being hoarded abroad, a government official has said. The ban was partially lifted on Monday.
The official said the ban had come on the back of suspicions that exporters were stockpiling cotton in China, and not fears of a production shortfall.
"Exporters had exhausted the available surplus for exports and were digging into domestic stocks. This could create domestic shortage," he said.
The government decided to allow exports only for firms that had already been issued permits. No new "registration certificates" for exports were being issued, a government notification said on Monday. Trade secretary Rahul Khullar said the government would not issue new export registrations until it "scrutinizes" existing applications.
Agriculture minister Sharad Pawar, Maharashtra chief minister Prithviraj Chauhan and Gujarat chief minister Narendra Modi had protested the ban, saying it would affect farmers and millers.
India is the world's second-largest producer and exporter of cotton.