Indian textile industry upbeat over cheaper US cotton import prospects

Indian cotton textiles industry upbeat on cheaper US cotton imports

The Indian cotton textiles industry has expressed optimism over the possibility of importing US cotton at lower tariffs, as expectations rise around new trade agreements with the United States and the European Union. Industry stakeholders believe that easier and cheaper access to imported cotton could help meet growing demand in the coming years and improve competitiveness in global markets.

With domestic cotton production stagnating over the past few years and prices remaining higher than global levels, mill owners and trade bodies are urging the government to reduce import duties or adopt a quota-based duty concession system. Currently, cotton imports (excluding extra-long staple varieties) attract around 11% duty, though industry experts suggest this could be reduced or waived for US cotton under a trade arrangement.

Industry leaders have proposed several possible policy options, including a 50% reduction in import duty for US cotton, duty-free imports up to a fixed quota, or a model similar to the Australian cotton import arrangement. Some traders estimate that duty-free imports could be allowed for up to 50,000 tonnes, while others expect a broader quota of 5–10 lakh bales.

Experts say high domestic prices are making imports attractive. The Cotton Corporation of India (CCI) is currently offering cotton at around ₹56,500 per candy (356 kg), while imported cotton is landing at below ₹54,000 per candy. Brazilian cotton, for instance, is reported to be even cheaper, with landed costs near ₹50,000 per candy.

According to industry representatives, US cotton is also preferred for its quality, consistency, and low contamination levels, which are important for export-oriented textile units. They argue that India’s cotton output has remained stagnant due to declining yields, pest attacks such as Pink Bollworm, and delayed adoption of new technologies.

Industry bodies such as the Tamil Nadu Spinning Mills Association (TASMA) and the Cotton Association of India (CAI) believe that trade agreements with the US and EU could significantly increase cotton demand and help stabilize supply chains. Some estimates suggest that imports may double in the current cotton season.

Experts also note that lower-cost imports could improve yarn production efficiency, as only about 65% of India’s yarn capacity is currently being utilized. Increased availability of raw cotton is expected to boost domestic consumption of yarn and support the textile value chain.

While details of the proposed trade mechanism are still awaited, the industry remains hopeful that policy changes will support sustainable growth and reduce raw material costs for mills across the country.

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