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Informist, Wednesday, Dec. 10, 2025

MUMBAI – The Cotton Association of India has requested the government to remove the 11% duty on imports of raw cotton as it is distorting prices and hurting the Indian textile industry's competitiveness. Removal of the duty will make the availability of competitive raw material to textile and spinning mills easier and support the industry amid the uncertainty of the US' tariffs and recessionary conditions in Europe, it said in a press release Tuesday.   

"If textile industry is not supported presently, it may immediately lead to unemployment, defaults on loans and an increase in bad debts in the entire textile value chain," the association said. 

The 11% duty on cotton imports was levied due to special circumstances during the COVID-19 period, the association said. Prior to that, India generally had no import duty on cotton and had no adverse impact on farmers, it pointed out.

Currently, lower domestic productivity and a high minimum support price of cotton has already made Indian cotton more expensive when compared to competing countries, the association said. With the farmers already protected via the high support prices, removal of the duty will ensure protection for the textile industry as well, it said. Unseasonal rainfall during the southwest monsoon in 2025 has damaged the quality of the Indian cotton crop, which is likely to compel textile mills to import cotton to meet the quality requirement of buyers, it said.

If the duty on cotton imports remains, global buyers are expected to shift to Vietnam, Bangladesh, Pakistan, and other markets, which could "lead to long-term damage and loss of India's share in the world cotton textile market," it said. "We are also likely to reach a favourable USA tariff solution. These events will bring a good opportunity for our textile tndustry to export yarn and other textile products in good volumes and increase India's share in the world trade of textiles," it said. 

Additionally, the textile ministry's target to achieve $100 billion in exports of textile products by 2030 will only be possible if competitive raw materials are available for the manufacturers, it said.  This is unlikely if the 11% import duty is still in place, it said.  End

Reported by Reshma Ravi

Edited by Vandana Hingorani

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