Govt extends import duty exemption on cotton till Dec 31

New Delhi:  The government on Thursday said it has temporarily exempted the import duty on cotton till December 31, 2025.

The decision has been taken to augment availability of cotton for the Indian textile sector. The Central Government had earlier temporarily exempted the import duty on cotton from August 19 till September 30.

“In order to support exporters further, the Central Government has decided to extend the import duty exemption on cotton (HS 5201) from 30th September 2025 till 31st December 2025,” the Finance Ministry said in a statement, adding that a notification will follow soon.

The decision, notified by the Central Board of Indirect Taxes and Customs (CBIC), is expected to lower input costs across the textile value chain, encompassing yarn, fabric, garments, and made-ups and provide much-needed relief to manufacturers and consumers alike.

The exemption includes the removal of both the 5 per cent Basic Customs Duty (BCD), the 5 per cent Agriculture Infrastructure and Development Cess (AIDC), and a 10 per cent Social Welfare Surcharge on both. Cumulatively, the entire 11 per cent import duty on cotton has been exempted.

Meanwhile, India’s textile and apparel sector has continued to demonstrate resilience despite the global uncertainties, to chart a positive growth trajectory in July, reaffirming the sector’s role as a key driver of employment, exports and economic growth.

According to quick estimates released by the Directorate General of Commercial Intelligence & Statistics (DGCIS), exports of major textile commodities in July reached $3.1 billion, marking a 5.3 per cent year-on-year growth compared to $2.94 billion in the same month last year.

For the period April–July 2025, cumulative textile exports stood at $12.18 billion, reflecting a growth of 3.87 per cent over the corresponding figure of $11.73 billion for the same period of the previous year.

–IANS