Centre extends customs duty exemption on cotton imports till December 31
New Delhi, October 31
The Centre has extended the customs duty exemption on cotton imports by two months till December 31, 2026, from the earlier deadline of October 31, to improve raw material availability and ease input costs for the domestic textile and apparel industry.
The Union Ministry of Finance notified the extension on Friday, amending an earlier notification issued on May 30, 2026. The government said the decision had been taken in the public interest.
Under the amendment, the date "31st day of October, 2026" in the earlier notification has been replaced with "31st day of December, 2026", extending the exemption period by two months.
The extension comes amid concerns over domestic cotton availability and firm prices. According to a Reuters report last week, domestic cotton prices had remained above Rs 9,000 per 100 kg, higher than the government's minimum support price of Rs 8,717 for the new season.
The report cited trade estimates that India's cotton output could fall below 29 million bales in 2026-27, against demand of more than 34 million bales. It also noted that the stock-to-use ratio, an indicator of available supplies relative to demand, was around 31 per cent, its lowest level in five years.
The extension is expected to improve cotton availability in the domestic market and ease input cost pressures across the textile and apparel value chain. It is likely to provide additional support to textile and garment manufacturers, particularly small and medium enterprises, by ensuring a more consistent supply of raw material for production.
The move also comes amid higher US tariffs on Indian goods. The United States implemented additional tariffs of 10 per cent and 12.5 per cent on imports from several trading partners, including India, from July 24, 2026.
The extension of the cotton duty exemption is expected to provide further relief to Indian textile and apparel exporters by helping them manage raw material costs amid these trade-related pressures while balancing the requirements of the textile industry with the interests of domestic cotton farmers.
The latest notification was issued by the Department of Revenue under the Ministry of Finance through the Central Board of Indirect Taxes and Customs.
— ANI
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