Government in 'advanced stage of consultation' on industry's demand for cotton import duty removal

📌 Summary:

• The government is in an "advanced stage of consultation" on removing the 11% customs duty on raw cotton imports, with a decision expected soon, a senior official said.
• The Finance, Textiles and Agriculture Ministries are deliberating on the duty, with the textile industry seeking its removal to ease cost pressures on domestic companies caused by high cotton prices.
• A delegation of apparel industry representatives and exporters recently met Vice President C.P. Radhakrishnan and several Union Ministers to seek the removal of the duty.
• The delegation cited a supply-demand gap: the textile industry's cotton requirement for the current year is projected at around 337 lakh bales, whereas cotton arrivals for the 2025-26 season are estimated at 292.15 lakh bales — a shortfall of nearly 45 lakh bales.
• The shortage is putting pressure on spinning mills and downstream textile manufacturers due to the limited availability of high-quality raw material and rising input costs.

🎯 UPSC Relevance: GS3 — customs and taxation policy, the competitiveness of the textile sector, and the linkage between agricultural output and industrial input costs.

📝 Prelims Facts:

• The customs duty on raw cotton imports is 11%
• The Finance, Textiles and Agriculture Ministries are jointly deliberating on the duty
• Textile industry cotton requirement (current year): ~337 lakh bales; estimated 2025-26 arrivals: ~292.15 lakh bales — a gap of nearly 45 lakh bales
• One standard bale of cotton in India is taken as 170 kg

🔑 Key Term: Customs duty — a tax levied on goods imported into (or exported from) a country; here, an 11% import levy on raw cotton, whose removal is sought to lower input costs for the textile industry.