India’s cotton reserve increase signals a shift in textile raw material access

India’s cotton’s carry-forward stocks for the 2026-27 season are projected to rise by 42 per cent, reaching over 85 lakh bales.  This sharp increase is a direct consequence of the government’s proactive decision to waive import duties on cotton from June through October 2026. By removing the 11 per cent effective import duty, the Ministry of Textiles has effectively leveled the playing field, allowing domestic spinners to access global fiber at competitive prices, a critical requirement for maintaining export parity with regional rivals like Bangladesh and Vietnam.

Industry analysis from the Cotton Association of India suggests, total imports for the 2025–26 season may reach 65 lakh bales, exceeding earlier forecasts of 47 lakh bales. While domestic production remains steady at 334 lakh bales, spinning mills are prioritizing imported fiber. Data indicates, imported cotton facilitates a 4 per cent higher yarn realization, yielding a market premium of approximately Rs 7 per kg.

This fiscal relief is not merely a cost-saving measure; it is an intervention to stabilize the value chain, notes a trade consultant. By strengthening raw material security, the policy supports the broader goal of scaling India's textile and apparel exports to $100 billion by 2030, ensuring that high-value yarn and fabric manufacturing remains viable despite global market volatility.

A comprehensive value chain, from fiber cultivation to finished apparel, the Indian textile industry serves global and domestic markets, focusing on cotton, silk, and man-made fibers. The sector is currently pursuing massive scaling via infrastructure projects, with a strong financial outlook targeting significant export growth by 2030.