Government Extends Cotton Import Duty Exemption Until December 31, 2026

Two-month extension aims to improve cotton availability, ease input costs for textile and apparel manufacturers, and provide relief to small and medium enterprises

The government has extended the customs duty exemption on cotton imports by two months, until December 31, 2026, from the earlier deadline of October 31. The decision is aimed at improving domestic cotton availability and supporting manufacturers across India’s textile and apparel value chain.

Finance Ministry Notification Extends Exemption

The Ministry of Finance issued a notification dated October 30, 2026, amending the existing notification issued on May 30, 2026, to extend the customs duty exemption.

The extension is expected to improve the availability of cotton in the domestic market and help reduce input costs across the textile and apparel sectors, according to a Finance Ministry official.

SMEs Expected to Benefit From Lower Input Costs

The move is also expected to provide relief to manufacturers, particularly small and medium enterprises (SMEs), while balancing the interests of domestic cotton farmers, the official added.

Cotton is a key raw material for India’s textile and apparel industry. Its availability and prices directly influence production costs across the value chain, making the exemption relevant for manufacturers managing raw material expenses.

Extension Aims to Ease Raw Material Constraints

The extension is intended to support the performance of the domestic textile industry by easing raw material constraints and helping manufacturers manage production costs.

Lower input costs could also provide some relief to consumers, depending on the extent to which manufacturers and other businesses pass on the benefit through the supply chain.