Shares of Welspun Living Ltd surged over 5% to ₹123.13 in Monday’s trade after the government announced a temporary exemption on the 11% customs duty on raw cotton imports till September 30, providing much-needed relief to the textile and garment industry.
The Finance Ministry’s notification, issued through the Central Board of Indirect Taxes and Customs (CBIC), removed both the basic customs duty and the Agriculture Infrastructure and Development Cess (AIDC) on cotton imports for a 42-day window starting August 19.
The move is expected to ease cost pressures across the textile value chain, covering yarn, fabric, garments, and made-ups. Industry body Confederation of Indian Textile Industry (CITI) welcomed the decision, saying it will help Indian cotton prices align better with international benchmarks and improve export competitiveness.
For companies like Welspun Living, a global home textiles leader with strong exposure to the US and Europe, the exemption comes as a timely measure. Exporters have been struggling under the burden of steep 50% US tariffs on Indian textile and apparel shipments, far higher than those levied on competitors like Bangladesh (20%) and Vietnam (20%).
Analysts believe the duty removal, though temporary, could support margins for domestic players and provide a psychological boost to an industry battling squeezed demand and rising competition. However, exporters continue to urge the government to negotiate lower tariffs with the US to prevent further market share losses.
