Updated: January 21, 2021 8:46:24 am
The state Cabinet on Wednesday approved to a proposal to provide a guarantee for the Rs 1,500-crore loan required by the Maharashtra State Cooperative Cotton Growers Marketing Federation.
Officials said that the government guarantee will be for the Rs 1,500-crore loan that the federation will take from the Bank of Maharashtra at 6.35 per cent per annum interest rate for ensuring timely payments to farmers on purchase of cotton for the 2020-21 season.
Due to satisfactory rainfall and favourable weather conditions, around 400 lakh quintal of cotton is expected to be produced this season in the state, an official said.
The official added that the purchase of cotton has started since last month.
Around 32 lakh quintal of cotton has been purchased from the farmers by the federation, the official said, adding that in the 2019-20 season, 93.89 lakh quintal cotton — worth Rs 5,023 crore — was purchased from farmers.
The official further said that considering the reduced prices of cotton in the international and open markets and the hike in guaranteed prices announced by the Union government, the federation will have to procure large quantities of the cotton at the guaranteed price this season compared to the last season.
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