India’s textile industry has sought a six-month extension of the duty-free import window for raw cotton. The current exemption is set to end on October 31, 2026.
The industry cited rising yarn prices and concerns over cotton availability. The request comes as cotton prices have increased by about 24% in the past six months.
Yarn Prices Rise Sharply
The government removed the 11% import duty on raw cotton from June to October 31. The move aimed to improve cotton availability and help control domestic prices.
According to The Economic Times, cotton yarn prices have risen by around 60% in 2026.
KM Subramanian, president of the Tiruppur Exporters Association (TEA), said the association has asked the central government to extend the duty-free window by six months.
Yarn is a major input for garment production. Subramanian said yarn costs account for about 60% of garment raw material costs. He also pointed to a shortage of yarn availability.
Cotton Production Under Pressure
India’s cotton production fell 2.35% to 290 lakh bales of 170 kg in 2025-26. Production has declined for six consecutive years.
Output has also fallen by more than 17% since 2021-22. The industry is now watching the new cotton crop season, which begins in October.
Pradip Jain, president of the Khandesh Ginning and Pressing Association, raised concerns over rainfall in key cotton-growing regions. These include Vidarbha, Marathwada, Telangana and parts of Gujarat.
Farmers Raise Price Concerns
Cotton farmers have also raised concerns about extending duty-free imports during the harvest season. They fear that higher imports could put downward pressure on domestic cotton prices.
Jain said imported cotton may not be much cheaper than domestic cotton at current international prices. He added that domestic cotton prices may remain around ₹9,000 per quintal.
The industry expects better cotton availability to support textile and garment production. Indian exporters are also looking to expand in new markets and use opportunities under the India-UK Free Trade Agreement.
