Overview

• New Finance Ministry guidance extends the temporary exemption on the roughly 11% import duty for raw cotton (HS 5201) from the original August 19–September 30 window to December 31, 2025.
• The government frames the move as ensuring availability for the textile sector and supporting exporters after Washington’s 50% tariffs on Indian goods took effect this week.
• AAP chief Arvind Kejriwal condemned the decision as a betrayal of farmers, demanded the 11% duty be reinstated, and claimed duty-free US cotton would be Rs 15–20 per kg cheaper than domestic cotton during the October harvest.
• Kejriwal urged retaliatory action of 100% tariffs on US imports and announced a farmers’ meeting on September 7 in Chotila, Gujarat to rally opposition to the waiver.
• Industry voices had warned the initial short window mainly aided in‑transit cargo, while the Global Trade Research Initiative said existing ECTA quotas already allow some duty‑free flows and argued US suppliers stand to benefit most from the extended waiver.