The Southern India Mills’ Association (SIMA) has supported the petition by C Joseph Vijay, Chief Minister, Government of Tamil Nadu, to eliminate the 11 per cent import duty on cotton. This executive intervention comes at a volatile juncture for the apparel sector, where a 25 per cent rise in domestic cotton prices - climbing from Rs 54,700 to Rs 67,700 per candy in just two months - has severely compressed manufacturing margins. With yarn prices following suit, rising to Rs 330 per kg, the industry faces an acute liquidity drain that threatens the viability of India’s $184 billion textile business.
Bridging the productivity deficit
The urgency of this policy shift is underscored by a widening supply-demand gap. While the Ministry of Textiles recently approved the Rs 5,659 crore ‘Mission for Cotton Productivity’ to address stagnant yields, the industry remains in a deficit cycle. Domestic production for the 2025-26 season is estimated at approximately 291 lakh bales, trailing a domestic demand of 328 lakh bales. Durai Palanisamy, Chairman, SIMA, emphasizes, while the Mission is a welcome long-term structural fix, the immediate 11 per cent tariff barrier renders Indian mills uncompetitive against Asian rivals who enjoy duty-free access to global fiber markets.
Safeguarding the value chain
Industry analysts warn that a shortage of even 1 lakh bales risks the livelihoods of 1 lakh workers across the value chain. By removing the import duty, the government could stabilize supply without impacting farmers, who remain insulated by a Minimum Support Price (MSP) currently 20 per cent above market rates. This fiscal recalibration is viewed as essential for India to reach its $350 billion textile vision by 2030, ensuring that regional clusters in Tiruppur and Coimbatore can maintain their export commitments amidst intensifying global competition.
A primary textile representative in South India
Founded in 1933, SIMA serves as the primary representative for the organized textile value chain in South India. Managing a diverse portfolio from spinning to technical textiles, the association oversees a membership of over 1,000 entities. SIMA is currently focused on facilitating the transition toward sustainable manufacturing and high-density planting systems to boost India’s long-term cotton self-reliance and global market share.
