The Central Government has announced a temporary exemption on cotton imports, removing all customs-related levies for five months beginning June 1, 2026. The measure is intended to improve the availability of raw cotton for domestic textile manufacturers and help the industry manage input costs more effectively. According to a notification issued by the Finance Ministry on Saturday, imported cotton will be exempt from both the basic customs duty and the Agriculture Infrastructure and Development Cess (AIDC). The relief will remain effective until October 30, 2026.
The latest decision offers significant relief to textile producers that rely on cotton as a key raw material. By suspending import duties, the government aims to make overseas cotton purchases more economical and ensure uninterrupted access to supplies during the upcoming production cycle.
The Finance Ministry’s notification stated, “The Central Government, on being satisfied that it is necessary in the public interest, hereby exempts cotton, when imported into India, from the whole of the duty of customs leviable thereon under the Customs Tariff Act and from the whole of the Agriculture Infrastructure and Development Cess.”
The exemption is expected to encourage higher imports, particularly at a time when industry stakeholders have been advocating for measures to improve raw material availability.
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Textile Industry Set To Benefit
India’s textile sector has repeatedly highlighted concerns over cotton supply and pricing. Industry participants have argued that easier access to imported cotton could help maintain production levels and reduce pressure arising from fluctuating domestic supplies.
With the duty waiver now in place, textile manufacturers may be able to procure cotton at lower costs, potentially improving competitiveness and operational efficiency. The move is also expected to provide greater flexibility to companies planning purchases for the upcoming manufacturing season.
Duty-Free Window Valid Until October 30
The exemption will remain operational for five months, covering imports made between June 1 and October 30, 2026. During this period, importers will not be required to pay either the basic customs duty or the Agriculture Infrastructure and Development Cess on cotton shipments entering the country.
