The Government of India has extended the import duty exemption on cotton until 31st December 2025, providing much-needed relief to the textile sector. This move will reduce input costs for spinning, weaving, and garment manufacturing units, ensuring stable cotton availability and strengthening India’s export competitiveness.
The exemption addresses the persistent gap between domestic cotton supply and industry demand, which is often disrupted by unpredictable weather, pest issues, and fluctuating cropping patterns. Although India produces most of its cotton needs, certain specialized varieties still rely on imports, particularly during lean supply periods.
Lowering import costs will have a cascading effect, reducing yarn, fabric, and garment prices while enabling Indian exporters, especially SMEs and EOUs, to compete globally. Between April and October of FY 2024–25, cotton textiles contributed 33% to India’s textile and apparel exports, worth USD 7.08 billion, and this extension is expected to drive further growth.
Farmers’ interests remain protected through the Cotton Corporation of India’s MSP policy, which ensures they receive at least 50% above production costs. Since imports primarily fulfill off-season and technical needs, they are not seen as a threat to local cotton sales.
Industry bodies have welcomed the decision, crediting Prime Minister Narendra Modi and Union Minister Giriraj Singh for responding to long-standing demands. The extension reinforces India’s commitment to self-reliance under ‘Make in India’ and Aatmanirbhar Bharat while positioning the country as a global cotton hub.
