New Delhi: The Confederation of Indian Textile Industry (CITI) has demanded that the government permanently remove the 11 per cent cotton import duty as it would help mitigate the cost pressure for domestic companies. A delegation from CITI met Union Agriculture Minister Shivraj Singh Chouhan last week to seek his intervention regarding the permanent removal of import duty on cotton of all varieties, the textile industry body said on Monday.
India's textile industry, the country's second-largest employment provider, requires stable access to high-quality cotton. In view of the persistent demand-supply gap, the government extended the import duty exemption on cotton until December 31, 2025. Various textile associations welcomed the government's move to exempt all varieties of cotton from the 11 per cent import duty.
With no further notification for extension from the government, the duty is reinstated from January 1, 2026. According to CITI, this will adversely impact the competitiveness of the country's textile and apparel sector. The minister assured the group that these concerns would be carefully considered during the review process, CITI stated. CITI also highlighted that cotton production in India has been steadily decreasing and is projected to fall this year to its lowest level in the last two decades, heightening concerns about supply shortages.
It argued that the reimposition of cotton import duty would further aggravate the cost pressure for companies. The industry members pointed out that during the last decade, average cotton imports have been around 20 lakh bales, constituting around 6.8 per cent of India's average domestic production. Further, imports are largely quality and specification-driven, catering to specialised cotton requirements and back-to-back export orders, and do not displace domestic cotton, CITI said.
Besides, major competing textile exporting countries such as Bangladesh and Vietnam have allowed duty-free access to cotton, giving them a structural cost advantage. One of the biggest generators of jobs and livelihoods, the textile and apparel sector is facing a significant challenge in the form of the 50 per cent US tariff, effective August 27, 2025. India's textile exports, including those to the US, are dominated by cotton.
The US is the single-largest market for India's textile and apparel exports, contributing almost 28 per cent to the overall revenue of the country's textile and apparel exporters. India's textile and apparel exports to the US were valued at nearly USD 11 billion in financial year 2024-25.
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