Textile industry welcomes customs duty exemption extension for cotton

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Published - October 31, 2026 09:16 pm IST - COIMBATORE

With daily cotton arrivals remaining dull at fewer than 70,000 bales a day during the first month of the current cotton marketing season (October 2026 to September 2027) and the Government of India deciding to extend the customs duty exemption on cotton till the end of December, the textile industry hopes there will be adequate cotton to meet the rising demand.

The Confederation of Indian Textile Industry (CITI) chairman Ashwin Chandran said in a press release that the duty exemption would strengthen the international competitiveness of the Indian textile and apparel sector that is targeting $100 billion in exports by 2030.

Cotton imports do not displace domestic cotton.

In May 2026, a joint study by Gherzi and the International Cotton Advisory Committee (ICAC) said Indian industry needs a cotton policy environment that will enable it to compete effectively with its Asian peers, which have duty-free access to international cotton.

Imports are necessary to bridge the demand-supply gap arising from reduced cotton production in India, he said.

“The extension of the cotton import duty waiver till December 31, 2026, will ensure that Indian textile and apparel companies can keep their input costs under control.

The move will provide near-term predictability for the value chain, enabling companies to plan production cycles and honour export contracts better,” he said in a statement.

According to Durai Palaniswamy, chairman of the Southern India Mills Association, the industry is likely to have imported around 72 lakh bales during the 2025-2026 season taking advantage of temporary duty exemptions (from June 1 to October 31) and mitigating the domestic cotton shortage.

There was no import duty on cotton during 2008-2021 that ensured win-win strategy for both the cotton farmers and the industry.

The Government levied import duty when the country was net exporter (30-70 lakh bales) of cotton and it gave temporary exemptions from 2022.

Mr.

Palaniswamy said Indian cotton productivity is 430-440 kgs a hectare as against the world average of 815kgs/ha and over 1,500 kgs/ha productivity level being achieved by more than 20 countries.

Considering the urgent policy intervention for raw material security, he sought import duty exemption for all varieties of cotton till 2030.

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