Archive · 20 Aug 2025
India Temporarily Scraps Cotton Import Duty for Textile Sector
The Indian government has removed the tax on imported raw cotton until the end of September.
This is to help the textile industry, which makes clothes and other fabrics, by lowering their costs.
The change will also help them compete in other countries, especially since the US has increased tariffs on Indian goods.
This means businesses can buy cotton more cheaply.
The government hopes this will make Indian textile exports stronger and keep cotton prices stable.
Some groups in the industry pushed for this change due to rising costs.
India removed the 11% import duty on raw cotton until September 30.
The decision aims to reduce costs for the textile industry and stabilize cotton prices.
The waiver addresses increasing tariff barriers in the US market.
Indian apparel exports face higher tariffs in the US compared to competitors like Bangladesh and Vietnam.
Industry groups lobbied for the waiver to combat high input costs.
- Who
- The Indian government, textile industry, and cotton importers.
- What
- The Indian government removed the 11% import duty on raw cotton.
- When
- Effective from August 19 to September 30.
- Where
- India
- Why
- To cool cotton prices, ease cost pressures on the textile industry, and boost export competitiveness.
Cotton Farmers
Textile Industry
Impact of Import Duty Removal
Cotton Farmers
Removal of import duty may cause downward pressure on domestic cotton prices.
Textile Industry
The government is prioritizing the textile industry, not cotton farmers.
- Duty Removed
- 11% import duty on raw cotton
- Effective Dates
- August 19 - September 30
- Primary Beneficiary
- Textile sector
- Reason for Removal
- To improve competitiveness and address rising costs
- Expected Impact
- Stabilize cotton prices, aid exporters
- US Tariffs
- 50% tariff on Indian apparel exports
Sources
Here's why Gokaldas Exports, KPR Mills, Welspun Living and other cotton stocks are in focus today
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Cotton stocks including Vardhman Textiles, Ambika Cotton soar on 11% import duty removal
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Indian government removes import duty on cotton till Sept-end