As per official data recently tabled in Parliament, India’s cotton imports skyrocketed from 15.20 lakh bales in the 2023–24 season to a staggering 41.40 lakh bales in 2024–25. This nearly three-fold increase serves as a critical ‘safety valve’ for the industry, following a season where domestic production dipped to its lowest levels in nearly two decades due to erratic rainfall across the primary ‘cotton belt’ of Gujarat and Maharashtra. By allowing imports to bridge the demand-supply gap, the government has ensured that the nation’s spinning mills - the backbone of the rural industrial economy - avoid the idle capacity that threatened the sector earlier this year.
Tariff relief and global price convergence
The pivot toward international markets was accelerated by a strategic intervention from the Ministry of Textiles, which extended the 11 per cent import duty exemption on raw cotton until December 31, 2025. This policy shift has successfully narrowed the gap between high domestic rates and softening global benchmarks. International prices for the equivalent S-6 cotton varieties have declined from approximately 79.15 US cents per pound in August to around 73.95 cents this December. Domestically, this has forced a correction, with prices cooling from Rs 57,000 to approximately Rs 52,500 per candy. This price convergence is vital for Indian exporters who are currently battling a punishing 50 per cent tariff wall in the United States; lower raw material costs are now the only viable lever to maintain price competitiveness against rivals like Vietnam and Bangladesh.
Beyond mere volume, the rise in imports - particularly from the United States, Brazil, and Australia- is driven by a demand for ‘contaminant-free’ and Extra Long Staple (ELS) cotton. Indian textile giants are increasingly blending these specialized foreign fibers with domestic crops to meet the stringent strength and uniformity standards required by high-street European retailers. To balance this influx, the Cotton Corporation of India (CCI) has aggressively scaled up its MSP operations, procuring over 31.19 lakh bales worth Rs 13,492 crore as of mid-December to ensure that the surge in foreign fiber does not result in distress sales for Indian farmers.
