India's Duty-Free Cotton Boost for Textile Sector

India has suspended import duties on raw cotton until September 30 to support its textile sector. This temporary relief aims to stabilize domestic prices and enhance raw material availability. The move coincides with US tariffs on Indian products following India’s purchases of Russian oil. Major cotton suppliers include Australia and the US.


Devdiscourse News Desk | New Delhi | Updated: 19-08-2025 17:38 IST | Created: 19-08-2025 17:38 IST
India's Duty-Free Cotton Boost for Textile Sector
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In a bid to bolster the textile industry, the Indian government has suspended import duties on raw cotton until September 30. This proactive measure is designed to enhance the availability of this vital raw material, benefiting domestic textile manufacturers at a time of international tariff challenges.

Previously subject to an 11 percent import duty, the exemption takes effect on August 19. The global competitiveness of India's textile sector is expected to improve as a result. The decision comes amid duty inversion challenges within the country's GST regime, posing a significant advantage for local manufacturers.

Meanwhile, Indian exporters face a steep 50 percent duty in the US, exacerbated by India's recent purchases of Russian oil. Cotton imports surged over 100 percent, signifying increased demand. Think tank GTRI notes that the 40-day exemption strategically stabilizes markets before the harvest season, avoiding prolonged downward pressure on domestic prices that may harm farmers.

(With inputs from agencies.)

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