India's Cotton Duty Suspension: Impact on U.S. Relations and Garment Industry

India has taken a significant step by suspending an 11% import duty on cotton until September 30, a measure indicating New Delhi's intent to address U.S. agricultural trade concerns and alleviate its domestic garment industry's burden. The suspension, announced late Monday, is set to benefit U.S. cotton growers while offering respite to India's apparel sector, which could soon face American tariffs as high as 60%.

The decision comes amid a diplomatic standoff, following the cancellation of a scheduled visit by U.S. trade negotiators in late August. This disruption has put proposed bilateral trade agreement talks on hold and quashed hopes for relief from an impending additional 25% tariff on Indian goods starting August 27, as imposed by President Trump in response to India's Russian oil purchases.

India's export sectors, particularly textiles, have been impacted by the U.S. tariffs, driving them to seek new markets. The duty's removal primarily benefits the U.S., India's second-largest cotton supplier. Sector experts assert that duty-free imports should continue beyond September 30 to sustain competitiveness amid global market shifts.

(With inputs from agencies.)