NEW DELHI, Sept 15: Cotton traders in India and Pakistan were disappointed at the collapse of world trade talks in Mexico but said the absence of an agreement on the core farm subsidies issue was better than a distorted pact.

World trade talks vital for the global economy collapsed in Mexico on Sunday after rich and poor states fought bitterly over farm reform and new rules to slash red tape and corruption.

“Cotton was at the centre of the agriculture subsidies issue and it was as well not to have an agreement without addressing the subsidy problem,” said D.K. Nair, secretary general of the Indian Cotton Mills Federation.

India and Pakistan together produce about 4.5 million tons of cotton a year, or about 22 per cent of global output.

Siddhartha Rajagopal, executive director of the Cotton Textiles Export Promotion Council, which represents 6,000 Indian exporters, said subsidies given by developed countries to cotton farmers were depressing markets and distorting prices.

Indian traders want subsidies to be cut immediately and eliminated as soon as possible.

“At the end of the day, you have to marry tariff reduction programmes in developing countries with high subsidies given in developed countries to agriculture products like cotton,” he said. India charges a 10-per cent import duty on cotton.

“The United States gives $3 billion of subsidy to its cotton producers, which is equal to our annual cotton textile exports,” Mr Rajagopal said.

But Naseem Usman, a cotton dealer in Karachi, said the market did not see any major impact due to the collapse of the talks.

Mian Anjum Saleem, chairman of the All Pakistan Textile Mills Association, said in case of the failure of globalization, Pakistan must look towards Iran, India and China through bilateral deals for exports.—Reuters