The South India Spinners Association (SISPA) has urged the government to introduce a permanent, predictable policy on the existing 11% cotton import duty along with a transparent, formula-based mechanism that would automatically suspend the duty whenever the gap between domestic and international cotton prices exceeds a specified threshold.
According to SISPA during the 2025–26 season, cotton prices rose sharply from about Rs. 55,000 (US $574.68) per candy to over Rs. 65,000 (US $679.17)– Rs. 70,000 (US $731.42) per candy, forcing many mills to procure raw material at these higher rates while continuing operations.
SISPA stated that small and medium spinning mills continue to face significant pressure due to volatility in cotton prices. These spinning mills purchase cotton only for immediate production needs and lack the financial capacity to hold large inventories. It also noted that a major share of the yarn produced by these mills is sold in the domestic market rather than being exported.
Fluctuations in domestic production, quality, and availability, along with movements in international cotton prices, have substantially raised raw material costs, affecting competitiveness and sustainability and such fluctuations often benefit intermediaries and stockholders, while the burden falls on spinning mills and textile manufacturers.
The association also emphasised the importance of ensuring that Indian cotton is available to the textile industry at globally competitive prices and quality standards, alongside improved market transparency and effective intervention through agencies such as the Cotton Corporation of India to stabilise prices.
