India’s Duty-Free Cotton Import Decision a Positive Sign for US

01-Sep-2025 04:09 PM

New Delhi. The central government has extended the deadline for duty-free import of cotton till 31 December 2025, whereas earlier it was subjected to 11 percent customs duty.

In fact, the domestic production of cotton has come down from 336.50 lakh bales (each bale of 170 kg) in 2023-24 to 344.40 lakh bales in the 2024-25 season. In the 2013-14 season, cotton production had reached an all-time high of 398 lakh bales.

During the current Kharif season, there was a decline of 2.6 percent in the sowing area of ​​cotton, due to which the government had to extend the period of duty-free import of cotton.

But this decision of the government is a positive message for America. The US exported cotton worth $8.82 billion in 2022, which dropped to $4.96 billion in 2024, the main reason for this was a sharp decline in imports from China.

China's import of cotton from the US during this period dropped from $2.79 billion to $1.47 billion. Not only this, but in the first half of 2025 (January-June), imports there fell further to $150.4 million.

This is causing great difficulty to the US and in such a situation, India's decision to import cotton duty-free can prove to be a boon for its cotton producers and exporters.

The Trump administration has also welcomed this decision of India. Now the US should also consider removing the 25 percent US customs duty imposed on the import of Indian products.

In the half year of January-June 2025, India imported cotton worth $181.5 million from the US, which is more than double the import of $86.9 million in the same period of 2024.

With the removal of customs duty, the import of American cotton in India can increase further. The share of processed goods of cotton imported from the US is 95 percent, due to which Indian millers can make yarn,

fabrics and textile products from it and sell it again in the world market. But some problems have started arising in the US market due to customs duty.