The finance ministry waived the custom duty on cotton imports till September 30th, a move that will benefit the textile industry and keep the prices low for the consumers.
The Government’s decision to remove import duty on cotton is likely to help bring down the prices of cotton in the country. Textiles secretary U P Singh informed LnL.
Cotton yarn currently attracts a duty of 5 percent Basic Duty (BCD) and 5 percent Agriculture Infrastructure Development Cess (AIDC). The industry has been demanding a waiver of duty to lower domestic prices.
“It would enable people to import. We are expecting within a day or two, you would see a impact on the prices going down but at the same time we would not expect the prices to be very low because there is a shortage all over the world “ reported Singh.
In India Cotton crops get affected because of unseasonal rains and in the US, there are drought like conditions. So supply is less, demand is high, import duty removal will help in cooling the prices in India.
Since the arrival of cotton in October 2021, the prices have been increasing. Singh says that the farmers are happy since they are getting twice the price of MSP.
The cotton prices soared to about Rs. 90,000 a candy up from Rs. 30,000 form 2019 level. Therefore, the industry was seeking relief from the Government.
This year the ministry is expecting an increase of 10-15% in cotton acreage since the farmers are benefitting from cotton crop. The prices for all commodities are increasing whether it is coal, cement, cotton and certain food items.
Every month about 1.5 to 2.0 lakh spindles are being added to the spinning industry because of increasing demand.
