Textile stocks rise on raw cotton duty waiver, US tariffs overshadow benefits

Textile stocks saw a renewed boost in the stock market as India temporarily lifted duties on raw cotton imports until September 30. Shares of companies like Vardhman Textiles, Ambika Cotton Mills, Gokaldas Exports, and Indo Count Industries caught the market's attention, reflecting a wave of positive sentiment.

Duty-free policy provides immediate cost relief to these companies, a welcome change at a time when their profit margins are under pressure. However, the sector's bigger challenge, the steep tariffs imposed by the US, still looms large over its future.

The relief from the cotton import duties is overshadowed by the US tariff issue. Starting August 27, Indian exports will be subject to a 50 per cent tariff from the US government. Scheduled for August 25-29, 2025, a planned visit by US trade negotiators to New Delhi has been called off. This has delayed hopes of progress on a bilateral trade agreement and expectations of a reduction in the additional 25 per cent levy. This double whammy makes Indian exports significantly more expensive compared to those of their global competitors.