New Delhi [India], August 19 : The central Government's step of reducing import duty on cotton will boost the textile industry of the country and will increase exports according to Praveen Khandelwal, BJP MP and Secretary General of Confederation of All India Traders (CAIT).
In an exclusive conversation with ANI, Khandelwal said, "The government has abolished the import duty on cotton. The agriculture infrastructure cess has also been eliminated. This is a welcome step. It will boost the country's textile industry. Cheaper raw cotton will reduce the production cost of our clothes and increase exports. Along with increased production, India's share will also grow."
In a major relief to the textile and garment industry, the Central Government on Monday announced a complete waiver of customs duty and Agriculture Infrastructure and Development Cess (AIDC) on the import of raw cotton.
According to a notification issued by the Ministry of Finance, the exemption will be applicable on cotton falling under heading 5201 of the Customs Tariff Act, 1975. The waiver will come into effect from August 19, 2025, and remain valid till September 30, 2025.
The Finance Ministry said the decision was taken in public interest to ease raw material costs for domestic manufacturers and exporters at a time when the textile sector has been facing price volatility and supply pressures.
Industry experts believe the move will help stabilize yarn prices, improve competitiveness of Indian garments in global markets, and support small and medium enterprises in the textile value chain.
They pointed out that the textile industry has been struggling with fluctuating input costs, and this waiver will help ease some of the burden.
The textile sector has also been impacted due to the tariffs by U.S. President Donald Trump, which added further challenges for Indian exporters. The government's decision is expected to provide stability and support to the industry in facing these tariff-related issues.
The temporary duty relief is expected to bring down input costs for fabric and garment manufacturers, especially ahead of the festive season when demand for cotton-based products generally increases. With cheaper raw cotton available, production is likely to pick up, creating opportunities for higher exports.
Overall, the Centre's move is seen as timely support for the textile industry.
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