NEW DELHI: India will review the cap on cotton exports in December after coming under pressure at home and abroad for the removal of trade restrictions .

A committee under finance minister Pranab Mukherjee will review the decision by the year-end , well before the US cotton crop comes into the market in February, agriculture minister Sharad Pawar said at the Economic Editors’ conference held here on Wednesday.

“We will review the cotton export scenario in December,” he said.

India has allowed export of only 5.5 million bales (1bale=170kgs).

A total of 4.4 million bales of cotton have already been approved for exports, after India relaxed export restrictions imposed last year on the back of a bumper crop, estimated at round 35 million bales for 2010-11 .

Pressure from the powerful textile industry at home forced the Centre to cap the quantum of exports despite tight global supply.

Textile organisations in the EU, Mexico and Turkey had accused India, the world’s second biggest cotton producer and consumer, of violating WTO rules by placing restrictions on trade.

Sections of the government, however , are of the view that farmers should be allowed to realise optimum price through exports. Reports of lower production in the US has boosted cotton to record prices, leading to panic buying by mills.

Meanwhile, a cotton conference on Wednesday held in top producer state Maharashtra demanded a higher support of Rs 4,500/qtl.

Mr Pawar, who is also the minister for food, PDS and consumer affairs, said he would hold talks with state governments soon over allowing foerign direct investment in multibrandretail .Whileopeninguptheretail sector would benefit both farmers andconsumersbyopeningupsupply bottlenecks, there was a need to discuss the impact of this on small retailers , he said.

The minister also raised the Centre’s estimates of sugar prodcution this year (2010-11 ) to a record 25mt, agood2mtaboveitsearlierfigure,ina span of few weeks as it prepares to takeadecisiononopeningupexports inmid-November .Privatesectorsugar platform ISMA has pegged output ataminimumof25mt,buttheCentre had pegged this at 23 mt earlier.