Government Extends Cotton Import Duty Exemption to December 2026

The Ministry of Finance extended the customs duty exemption on cotton imports until 31 December 2026. The extension was announced on 30 October 2026, replacing the previous deadline of 31 October.

Extension and objectives

Notification No. 35/2026-Customs amended Notification No. 19/2026-Customs, dated 30 May 2026, under which the exemption was initially granted. The government said it was satisfied that continuing the exemption was necessary in the public interest. It aims to improve cotton availability and reduce input costs for the domestic textile and apparel industry, particularly benefiting small and medium enterprises (SMEs).

Cotton supply conditions

Poor southwest monsoon conditions have affected the cotton crop, while daily arrivals remain low. The new cotton marketing season began on 1 October. The textile industry expects cotton consumption to rise this year and has sought permanent removal of the import duty.

Important Facts for Exams

• Statutory exemption power: Section 25(1) of India’s Customs Act, 1962 empowers the Central Government to exempt goods from customs duty by notification when it considers exemption necessary in the public interest.
• Cotton price-support procurement: The Cotton Corporation of India, a public-sector undertaking under the Ministry of Textiles, is the central agency that conducts minimum-support-price procurement of seed cotton.
• Cultivated cotton species: India is the only country cultivating all four domesticated cotton species: Gossypium arboreum, G. herbaceum, G. hirsutum and G. barbadense.