No customs duty on cotton imports till October 31
What's the story
The Indian government has announced a five-month exemption from customs duty on cotton imports, effective from June 1. The step is aimed at increasing the availability of raw materials for the domestic textile industry. The waiver, which will be in effect until October 31, 2026, is expected to reduce input costs for textile and apparel manufacturers, especially small and medium enterprises (SMEs).
Cost reduction
Duty exemption to ease supply constraints, stabilize market
The government's decision comes in the wake of concerns over tight cotton supply and rising prices, which have been driving up production costs for textile companies. By allowing cheaper imports, the government hopes to ease supply constraints and stabilize the market ahead of peak festival and export seasons. This move is also expected to enhance competitiveness in the textile sector by reducing raw material costs.
Market stabilization
CITI welcomes move
The temporary exemption from customs duty is expected to address the immediate supply pressures in the textile industry. It also aligns with broader efforts to strengthen India's textile sector, which contributes significantly to employment and export earnings. The Confederation of Indian Textile Industry (CITI) has welcomed this move, saying it will make the Indian textile and apparel sector more competitive in the international market amid global challenges.