Government Extends Cotton Import Duty Exemption Till December 31
Offering crucial relief to India’s textile exporters grappling with steep US tariffs, the Central Government has extended the exemption on cotton import duty until December 31, 2025, the Ministry of Finance announced today.
Initially introduced as a temporary measure from August 19 to September 30, 2025, the duty waiver has now been prolonged to ensure steady cotton availability for domestic manufacturers and exporters. The ministry noted that additional notifications would follow in due course.
The textile and apparel industry, which contributes nearly 2% to India’s GDP and employs millions, has been under strain after the United States imposed a 50% tariff on Indian exports, affecting nearly US$ 11 billion worth of shipments in 2024-25. The US remains India’s largest export market for textiles, accounting for 28% of outbound trade in the sector.
Welcoming the decision, Rakesh Mehra, Chairman, Confederation of Indian Textile Industry (CITI), said the waiver would provide much-needed support. “The textile and apparel sector is one of the biggest providers of jobs and livelihoods. This move will help exporters navigate immediate challenges,” he stated.
CITI Secretary General Chandrima Chatterjee added that the extension reflected persistent appeals from industry bodies. “It’s a great move for the Indian industry, and if it also signals positively in trade negotiations, then it’s a win-win for both sides,” she said.
By extending the waiver till year-end, the government has given the industry vital breathing space as talks toward a possible trade deal with the US continue.
