The Central Government on Thursday extended the exemption of import duty on cotton until December 31, 2025, in a move which it says is aimed at supporting the domestic textile sector and exporters.
The duty waiver, which was first introduced on August 19, 2025, was initially scheduled to end on September 30, 2025. With the latest decision, the exemption on raw cotton imports (HS 5201) will remain in place for an additional three months.
According to the government, the step has been taken to ensure adequate availability of cotton for the textile industry, which has faced high input costs in recent months. A formal notification on the extension will be issued shortly.
Raw cotton imports typically attract an 11% duty, including agriculture infrastructure and development cess. The suspension is aimed at easing supply constraints and providing Indian textile mills access to raw material at globally competitive rates.
However, the exemption announcement saw textile and cotton-related stocks—such as Vardhman Textiles, Ambika Cotton Mills, Welspun Living, Gokaldas Exports, and others—falling in opening trade.
Vardhman Textiles shares fell as much as 2.25%, trading at Rs 389.20 apiece on the BSE, while Ambika Cotton Mills, Welspun Living, and Gokaldas Exports were down by 0.62%, 1.75% and 1.80% at Rs 1380.70, Rs 112, and Rs 676.45 respectively.
Indian government's import relief also comes amid U.S. President Donald Trump's doubling of tariffs on imports from India to as much as 50% on good such as garments and jewellery.
Washington is New Delhi's largest market for garments and jewellery, worth nearly $22 billion in 2024. India has a 5.8% share in the U.S. garment market, behind China, Vietnam and Bangladesh.
The duty waiver, which was first introduced on August 19, 2025, was initially scheduled to end on September 30, 2025. With the latest decision, the exemption on raw cotton imports (HS 5201) will remain in place for an additional three months.
According to the government, the step has been taken to ensure adequate availability of cotton for the textile industry, which has faced high input costs in recent months. A formal notification on the extension will be issued shortly.
Raw cotton imports typically attract an 11% duty, including agriculture infrastructure and development cess. The suspension is aimed at easing supply constraints and providing Indian textile mills access to raw material at globally competitive rates.
However, the exemption announcement saw textile and cotton-related stocks—such as Vardhman Textiles, Ambika Cotton Mills, Welspun Living, Gokaldas Exports, and others—falling in opening trade.
Vardhman Textiles shares fell as much as 2.25%, trading at Rs 389.20 apiece on the BSE, while Ambika Cotton Mills, Welspun Living, and Gokaldas Exports were down by 0.62%, 1.75% and 1.80% at Rs 1380.70, Rs 112, and Rs 676.45 respectively.
Indian government's import relief also comes amid U.S. President Donald Trump's doubling of tariffs on imports from India to as much as 50% on good such as garments and jewellery.
Washington is New Delhi's largest market for garments and jewellery, worth nearly $22 billion in 2024. India has a 5.8% share in the U.S. garment market, behind China, Vietnam and Bangladesh.
You may also like
Rylan Clark issues powerful statement after praising migrants who saved mum's life
Raghuram Rajan urges India to reconsider Russian oil buys like Trump wants
J-K: Vaishno Devi Yatra suspended after landslide, devotees await resumption
534 roads blocked, 1184 electricity distribution transformers disrupted as torrential rains continue in Himachal Pradesh
Assam Police recovers heroin and Yaba tablets, four arrested
