CITI Seeks Removal Of Cotton Import Duty
A delegation from the Confederation of Indian Textile Industry (CITI) met Union Minister of Agriculture & Farmers’ Welfare Shivraj Singh Chouhan in New Delhi on January 9, 2026, requesting the permanent removal of import duty on all varieties of cotton.
The delegation flagged concerns over the reinstatement of cotton import duty from January 1, 2026, noting that it could erode the global competitiveness of India’s textile and apparel sector. The minister assured that the concerns would be examined during the review process.
Industry representatives informed the minister that India’s cotton production has been declining and is expected to fall this year to its lowest level in nearly two decades, increasing the risk of a domestic supply crunch. They stressed that import duties in such a scenario would inflate raw material costs for spinners and manufacturers.
The delegates noted that India has been importing around 20 lakh bales annually, roughly 6.8% of domestic output, primarily for quality-specific and export-linked requirements, which do not displace domestic cotton. They also pointed out that contamination-free and specialised cotton grades required for high-value, export-oriented textiles are available only in limited quantities within the country.
According to CITI, the import duty has kept domestic cotton prices at a consistent premium over international benchmarks due to import price parity, impacting the entire value chain. Meanwhile, competing textile-exporting nations such as Bangladesh and Vietnam offer duty-free cotton access, giving them a structural cost advantage.
The delegation underlined that the industry fully supports farmer interests, which are already protected through the Minimum Support Price (MSP) mechanism. The MSP for cotton has been raised by about 8% this season and is currently above market prices, ensuring a safety net for farmers even as manufacturers face rising costs.
The textile and apparel sector, a major generator of employment, is simultaneously dealing with external trade pressures, including the 50% US tariff effective August 27, 2025. The US accounts for nearly 28% of India’s textile and apparel export earnings, with shipments valued at almost US$11 billion in FY 2024–25, largely dominated by cotton-based products.
