Agriculture Ministry Remains Non-Committal Amid Textile Ministry’s Push for Cotton Duty Reductions.

The Textile Ministry has proposed a temporary removal or reduction of import duties on raw cotton to alleviate input costs for apparel exporters, particularly in light of ongoing geopolitical tensions in West Asia. This proposal comes amid discussions with the Revenue Department, where the Textile Ministry has committed to ensuring that such duty cuts would not adversely affect domestic farmers. The Agriculture Ministry is currently hesitant, conducting multi-stakeholder consultations due to the political and economic sensitivity surrounding raw cotton, complicating the prospects of a swift decision.

This development has significant implications for the common citizen and the market. Rising raw cotton prices, exacerbated by limited domestic supply and geo-political disruptions, are directly impacting the textile sector’s competitiveness. With garments exports declining by 2.2% to $35.8 billion in the fiscal year 2025-26, apparel exporters are seeking urgent relief from the Finance Ministry. If import duties are reduced or removed, it could stabilize prices and relieve production cost pressures, potentially benefiting consumers through lower apparel prices; however, the outcomes depend on how such policies balance the interests of farmers and traders who currently control much of the cotton supply.

Looking ahead, the government’s decision-making process regarding import duties will be critical. The Agriculture Ministry’s cautious approach reflects its need to weigh the economic implications for cotton farmers against the urgent requests from the textile sector. As the Textile Ministry continues lobbying for a timely resolution, the outlook hinges on successful negotiations among stakeholders, particularly the alignment of agricultural and trade interests. Ensuring a favorable balance could foster a more supportive environment for the apparel sector, especially if the cotton crop prospects remain positive as indicated by revisions from the Cotton Association of India.