THEBUSINESSBYTES BUREAU

NEW DELHI, MARCH 18, 2026

In a decisive move aimed at reinforcing farmer welfare and stabilising cotton markets, the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, has sanctioned ₹1,718.56 crore to the Cotton Corporation of India (CCI) for procurement operations.

The funding, approved as part of the Minimum Support Price (MSP) mechanism for the 2023–24 cotton season, is expected to ensure timely and assured price support to cotton growers across the country. The decision underscores the government’s continued commitment to shielding farmers from market volatility while advancing the broader vision of self-reliance in the agriculture sector.

According to an official statement, "In a significant step towards strengthening farmer welfare and advancing the vision of Aatmanirbhar Bharat, the CCEA has approved Minimum Support Price (MSP) funding of Rs 1,718.56 crore to the Cotton Corporation of India (CCI) for the cotton season 2023–24."

The MSP for seed cotton (kapas) is determined annually by the Centre based on recommendations from the Commission for Agricultural Costs and Prices (CACP). The CCI functions as the nodal agency responsible for executing MSP operations, stepping in to procure Fair Average Quality (FAQ) cotton directly from farmers whenever market prices dip below the assured threshold.

Importantly, the procurement process remains open-ended, with no quantitative cap, ensuring that farmers can sell their produce without restriction during periods of price distress. This mechanism plays a crucial role in maintaining price stability and safeguarding farm incomes.

"Cotton remains one of India's most vital cash crops, sustaining the livelihoods of approximately 60 lakh farmers and supporting 400–500 lakh people engaged in allied activities, including processing, trade, and textiles," the statement said.

With this fresh infusion of funds, the government aims to further strengthen procurement infrastructure and ensure seamless operations, reinforcing confidence among cotton farmers while supporting the broader value chain linked to one of India’s most significant agricultural commodities.