Extension of the Deadline for Duty-Free Cotton Imports, as Anticipated

New Delhi. In light of an expected decline in domestic production and a potential rise in prices, an extension to the deadline for duty-free cotton imports was anticipated; the government has now announced a two-month extension.

On October 30, the Union Ministry of Finance issued a notification stating that the period for duty-free cotton imports has been extended until December 31, 2026—a shift from the previously set deadline of October 31, 2026. This move will provide relief to the nation's textile industry, allowing it to continue importing cotton from abroad at lower costs.

Notably, cotton was previously subject to an 11 percent import duty, which was temporarily suspended in July. At that time, duty-free imports were permitted until October 31, 2026. Although this deadline was set to expire today, it has been extended by two months. Consequently, duty-free cotton imports will continue until the end of the current year—a measure the textile industry had been advocating for.

With major cotton-producing states like Maharashtra and Karnataka facing drought conditions, domestic cotton yields are expected to decline, which could complicate the supply and availability of cotton. Furthermore, the Cotton Corporation of India does not hold significant stocks, raising concerns that the textile industry might face increased difficulties.