India’s cotton imports are expected to reach or exceed the record 71 lakh bales recorded in 2025-26, as concerns over domestic crop production and rising textile industry demand drive imports higher. The Centre has extended the customs duty exemption on cotton imports by two months, until December 31, 2026, to improve raw material availability for textile mills.

Lower cotton acreage and drought conditions in key producing states are expected to affect domestic production in 2026-27. Industry estimates suggest cotton output could decline to around 280 lakh bales, while consumption may rise to 365 lakh bales, widening the supply-demand gap.

The extension of the 11% customs duty exemption is expected to help spinning mills access contamination-free imported cotton at competitive prices and strengthen India's textile export competitiveness. Rising synthetic fibre prices have also encouraged some mills to shift towards cotton yarn production.

Following the announcement, domestic cotton prices eased by around ₹500 per candy, trading at approximately ₹65,700–66,200. Industry experts expect imports to remain strong as textile demand increases and domestic supplies remain constrained.