Maharashtra accounts for about 30% of the area under cotton and about 20% of cotton production in the country. 30 lakh families who are spread over in 22000 villages in the economically backward regions of Vidarbha and Marathwada of Maharashtra depend upon cotton cultivation. Most of these are small and marginal farmers.
Several malpractices’s like lower rate, wrong weighment, high deductions, delay and uncertainty of payment, high fluctuations in the rates paid by speculative traders existed in the market as a result of which the cultivators were deprived of fair price for their produce. Hence the Government of Maharashtra enacted the Raw Cotton (Procurement, Processing and Marketing) Act, 1971. The act was implemented with effect from 1972-73 cotton seasons.
From season 2005-06 onwards in absence of act Govt. of Maharashtra has resolved to continue cotton procurement scheme at the minimum support price declared by Govt. of India.(GOI).