Textile Industry Seeks Six-Month Extension for Duty-Free Cotton Imports

New Delhi, Sep 14 (KNN) India’s textile industry has sought a six-month extension of the duty-free import window for raw cotton beyond October 31, citing a sharp rise in yarn prices and concerns over cotton availability.

The government had waived the 11Percent import duty on raw cotton from June to October 31 to improve availability and help moderate domestic prices. Cotton prices have risen about 24Percent over the past six months, while cotton yarn prices have increased by around 60Percent in 2026 The Economic Times reported.

"We have requested the central government to extend the duty-free import window of raw cotton by six months as the cotton yarn prices have jumped 60Percent in 2026, adding to the challenges of the apparel exporters," said KM Subramanian, president, Tiruppur Exporters Association (TEA).

India’s cotton production declined 2.35Percent to 290 lakh bales of 170 kg in 2025-26. Production has fallen for six consecutive years and has contracted by more than 17Percent since 2021-22.

"Yarn cost accounts for about 60Percent of the raw material cost of garments. Along with price increases, we are also facing a shortage of yarn availability," said Subramanian.

The industry has also raised concerns over cotton production in the new crop season beginning October. "The rainfall situation is not good in cotton-producing areas like Vidarbha, Marathwada, Telangana and parts of Gujarat," said Pradip Jain, president, Khandesh Ginning and Pressing Association.

However, cotton farmers have expressed concern that an extension of duty-free imports during the harvest period could put downward pressure on domestic cotton prices, particularly amid higher input costs for fertilisers and seeds.

"Looking at the prevailing international cotton prices, imported cotton is not likely to be much cheaper than the domestic cotton. The domestic cotton prices may not fall below the current level of Rs 9000/quintal. It will help to boost the availability of cotton for the industry," said Jain.

Indian textile and garment exporters are seeking to leverage the India-UK Free Trade Agreement and expand their presence in new export markets after the tariff war with the US adversely affected India’s exports.

(KNN Bureau)