Textile Industry Gets Temporary Relief as Cotton Import Duty Removed
20-Aug-2025 11:54 AM
Mumbai. The Central Government has abolished the 11 percent customs duty on cotton imports. This decision has come into effect from August 19 and will remain effective till the end of the current marketing season i.e. 30 September 2025.
The time period for the removal of customs duty is short, so the cotton textile industry will get only temporary relief. Despite this, additional import of up to 10-12 lakh bales of cotton is estimated during this period.
The new marketing season of cotton will start from October 1, 2025 and then the arrival of new domestic goods of cotton will start gaining momentum. It is worth noting that the price of cotton is soft in the international market right now and hence the removal of customs duty will give a good incentive to importers to increase its import.
A leading trade organization - Cotton Association of India has welcomed this decision of the government and has urged to clarify the situation regarding the import modalities as soon as possible. It is understood that Indian exporters are facing difficulty in maintaining their position in the US, a major buyer of Indian cotton products,
due to the imposition of 25 percent import duty from August 7. Not only this, but an additional 25 percent tariff has been announced on Indian products in the US from August 27, which will increase the total import duty to 50 percent.
Countries like China, Bangladesh, Pakistan and Vietnam will get a good opportunity to increase the export of textile products to the US as the duty on it will be very low. India will have to reduce the price of its products to face competition and this is possible only when the cost of the products comes down.
Import of cheap cotton from abroad can prove to be helpful in this direction. The arrival of new cotton has started in Brazil and there is a possibility of its huge import to India from there.
Around 33 lakh bales (each bale of 170 kg) of cotton have been imported in India during the current marketing season till the end of July, while additional import of at least 10 lakh bales of cotton is expected till September 30.