India bans all cotton exports



  • Is Nagesh running trade policy over there? So much for economic liberalization and prosperity, eh?



  • Next up: burn the cotton to keep farmers from losing money. It's the FDR school of economic policy!



  • @morbiuswilters said:

    Next up: burn the cotton to keep farmers from losing money. It's the FDR school of economic policy!
     

    Have they considered coating the cotton in chocolate and getting people to eat it?



  • @RTapeLoadingError said:

    @morbiuswilters said:

    Next up: burn the cotton to keep farmers from losing money. It's the FDR school of economic policy!
     

    Have they considered coating the cotton in chocolate and getting people to eat it?

    This is India we're talking about; they can't afford that much chocolate*. No, your cotton will be soaked in salt and you will like it.

    *Unless, of course, we stop the export of chocolate from India. Then the price of chocolate will collapse. Of course, then we'll have to burn the excess chocolate so the chocolate farmers don't go broke.



  • @morbiuswilters said:

    @RTapeLoadingError said:

    @morbiuswilters said:

    Next up: burn the cotton to keep farmers from losing money. It's the FDR school of economic policy!
     

    Have they considered coating the cotton in chocolate and getting people to eat it?

    This is India we're talking about; they can't afford that much chocolate*. No, your cotton will be soaked in salt and you will like it.

    If they can manage both they have a ready made anthem for the movement.


     



  • @RTapeLoadingError said:

    @morbiuswilters said:

    @RTapeLoadingError said:

    @morbiuswilters said:

    Next up: burn the cotton to keep farmers from losing money. It's the FDR school of economic policy!
     

    Have they considered coating the cotton in chocolate and getting people to eat it?

    This is India we're talking about; they can't afford that much chocolate*. No, your cotton will be soaked in salt and you will like it.

    If they can manage both they have a ready made anthem for the movement.


     

    Checkmate.



  • Catch-22 FTW



  • @boomzilla said:

    Is Nagesh running trade policy over there? So much for economic liberalization and prosperity, eh?
    There's something a bit odd about that article.  It says that 80% off  Inida's cotton exports go to China.  But it also says that China is the world's largest cotton exporter.



  • @El_Heffe said:

    @boomzilla said:

    Is Nagesh running trade policy over there? So much for economic liberalization and prosperity, eh?
    There's something a bit odd about that article.  It says that 80% off  Inida's cotton exports go to China.  But it also says that China is the world's largest cotton exporter.

    This random page seems to say that the USA is the largest cotton exporter, but that China is the world's largest cotton consumer.

     

    But, I understand it's not too unusual for a given place to export some locally-produced goods while also importing that same thing made elsewhere.

    I have no idea why this would be considered a good idea, but perhaps this is why I am not an economist.



  • @aihtdikh said:

    I have no idea why this would be considered a good idea, but perhaps this is why I am not an economist.
     

    Separation of high-end / low-end markets.



  • @aihtdikh said:

    But, I understand it's not too unusual for a given place to export some locally-produced goods while also importing that same thing made elsewhere.

    I have no idea why this would be considered a good idea, but perhaps this is why I am not an economist.

    Wild guess (as in, I can't be bothered to do the research), but it would be conceivable in this case that Chinese cotton was produced in the east and hence it's cheaper to export it by ship and import cotton for consumption in the west a short distance from India than to send it by land from the east to the west. Sea transport is pretty cheap compared to land transport.



  • @El_Heffe said:

    There's something a bit odd about that article.  It says that 80% off  Inida's cotton exports go to China.  But it also says that China is the world's largest cotton exporter.


    You can do both: import large amounts of cotton then resell most of it to other countries. Granted, this does not seem to make that much sense, given that those other countries would probably go to India directly rather than via a middle man — since Catch-22 has already been mentioned, I doubt anyone could pull a deal with cotton like the one with the eggs in that novel.

    That, or the sources make no distinction between raw and processed cotton — that is, clothes.



  • @dhromed said:

    @aihtdikh said:
    I have no idea why this would be considered a good idea, but perhaps this is why I am not an economist.
    Separation of high-end / low-end markets.
    The same happens to Belgian tomatoes. These high quality tomatoes are exported to Dubai and the like. The average Belgian consumer however has to put up with cheap Spanish tomatoes

     



  • @aihtdikh said:

    I have no idea why this would be considered a good idea, but perhaps this is why I am not an economist rich.

    FTFY



  • There are lies, damned lies and statistics - Mark Twain

    So it would not surprise me if all those cotton statistics are 'correct' in some twisted distorted form.



  • @El_Heffe said:

    @boomzilla said:

    Is Nagesh running trade policy over there? So much for economic liberalization and prosperity, eh?
    There's something a bit odd about that article.  It says that 80% off  Inida's cotton exports go to China.  But it also says that China is the world's largest cotton exporter.

    Maybe China is the middle man in the cotton trade.



  • @bjolling said:

    @dhromed said:

    @aihtdikh said:
    I have no idea why this would be considered a good idea, but perhaps this is why I am not an economist.
    Separation of high-end / low-end markets.
    The same happens to Belgian tomatoes. These high quality tomatoes are exported to Dubai and the like. The average Belgian consumer however has to put up with cheap Spanish tomatoes.
     

    Argentina, on the other hand, gets it right.  The best beef in the world comes from the pampas, and the best of it never leaves the country.  You really don't know what steak is until you've had been dowh there...

     



  • @Mason Wheeler said:

    @bjolling said:

    @dhromed said:

    @aihtdikh said:
    I have no idea why this would be considered a good idea, but perhaps this is why I am not an economist.
    Separation of high-end / low-end markets.
    The same happens to Belgian tomatoes. These high quality tomatoes are exported to Dubai and the like. The average Belgian consumer however has to put up with cheap Spanish tomatoes.
     

    Argentina, on the other hand, gets it right.  The best beef in the world comes from the pampas, and the best of it never leaves the country.  You really don't know what steak is until you've had been dowh there...

     

    Unless you live in Brazil, which also gets its large share of meat from the Pampas. I figure we're no 1. importer.



  • @bjolling said:

    The same happens to Belgian tomatoes. These high quality tomatoes are exported to Dubai and the like. The average Belgian consumer however has to put up with cheap Spanish tomatoes

    Part of the reason for that is because you're shipping fresh produce there, which will deteriorate in transit — so if you want to deliver quality goods on the other side of the world, you will have to send some of the best that you have. I suppose it is then cheaper to import Spanish tomatoes than to keep some of the lower-grade ones for your own consumption.


  • Discourse touched me in a no-no place

    @RTapeLoadingError said:

    @morbiuswilters said:

    Next up: burn the cotton to keep farmers from losing money. It's the FDR school of economic policy!
     

    Have they considered coating the cotton in chocolate and getting people to eat it?

    Actually, that's what they do with excess corn here in the U.S. (after changing it into corn syrup and other processing).


  • Discourse touched me in a no-no place

    @morbiuswilters said:

    Next up: burn the cotton to keep farmers from losing money. It's the FDR school of economic policy!
    Hey, it works for corn (after some processing); why not cotton?



  • @Gurth said:

    You can do both: import large amounts of cotton then resell most of it to other countries.

    Or, say, Chinese cotton is high quality and Indian cotton is low quality; thus Chinese cotton fetches a much higher price. China sells their cotton for the high price, imports cheap Indian cotton and then has money left over. There are many cases where this makes sense. For example, the US imports 11.3m bbl/day of petroleum products but also exports 1.7m bbl/day.



  • Saw a show that demonstrated the exact same principle for garlic. China exports that stuff in bulk on the cheap, and other producers (france, spain) serve the upper section of the market at 200% rate.



  • @morbiuswilters said:

    @Gurth said:
    You can do both: import large amounts of cotton then resell most of it to other countries.

    Or, say, Chinese cotton is high quality and Indian cotton is low quality; thus Chinese cotton fetches a much higher price. China sells their cotton for the high price, imports cheap Indian cotton and then has money left over. There are many cases where this makes sense. For example, the US imports 11.3m bbl/day of petroleum products but also exports 1.7m bbl/day.

    It's also important to note that in these commodities at least, it's various private actors, not a central planner directing the purchases and sales from a single account. So all of these motivations are probably correct to some extent or other.



  • @boomzilla said:

    @morbiuswilters said:
    @Gurth said:
    You can do both: import large amounts of cotton then resell most of it to other countries.

    Or, say, Chinese cotton is high quality and Indian cotton is low quality; thus Chinese cotton fetches a much higher price. China sells their cotton for the high price, imports cheap Indian cotton and then has money left over. There are many cases where this makes sense. For example, the US imports 11.3m bbl/day of petroleum products but also exports 1.7m bbl/day.

    It's also important to note that in these commodities at least, it's various private actors, not a central planner directing the purchases and sales from a single account. So all of these motivations are probably correct to some extent or other.

    Well, this is China and India we're talking about; not exactly bastions of economic liberty (or any liberty, really). Maybe the real reason China imports and exports so much cotton is because the Communist Party's Secretary of Cotton allied with the Party's Secretary of Exports to stage a coup against the Party's Secretary of Imports, and now they are consolidating their fiefdoms. Or maybe the Secretary of Cotton was carefully parsing Mao's words and found the statement "cotton is the opiate of the masses" and decided to realign the entire economy around this chestnut of Marxist-Leninist-Stalinist-Maoist wisdom.



  • @morbiuswilters said:

    Well, this is China and India we're talking about; not exactly bastions of economic liberty (or any liberty, really).

    Yep. I wouldn't be shocked to find out that some of the companies in China were state owned, but I still would doubt that they're subject to a central plan from Beijing. More likely it's just fattening the wallet of some group of apparatchiks who are still looking out for the best deals while skimming some off the top for themselves.



  • @boomzilla said:

    Is Nagesh running trade policy over there? So much for economic liberalization and prosperity, eh?

    I am not ruining any policy over here



  • @Nagesh said:

    @boomzilla said:
    Is Nagesh running trade policy over there? So much for economic liberalization and prosperity, eh?
    I am not ruining any policy over here
    Ha! You are evading the question.  This proves you must be running it.



  • No it doesn't! Anyone who runs trade policy is by definition ruining it, so if he's not ruining it, he couldn't possibly be running it!



  • @ekolis said:

    No it doesn't! Anyone who runs trade policy is by definition ruining it, so if he's not ruining it, he couldn't possibly be running it!
    +1



  • And then things got really stupid.

    There is a Budget proposal to tax at 30 percent any investment received by closely held companies where the aggregate investment exceeds the fair market value of shares. Put simply, this would mean an angel investor investing in a company where the investment is in excess of the fair value of the shares, will be taxed and his investment will be considered as income for the entrepreneur.

    The best thing you can say is that it's just a proposal.


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