India could soon receive zero-duty access to the US market for garments made from American cotton. It’s a well-planned strategic move that may benefit the country’s textile sector on a large scale. Union Commerce Minister Piyush Goyal has hinted that the proposed arrangement would be similar to the deal available to Bangladesh under its trade understanding with Washington.
According to Goyal, the final trade agreement between India and the US is expected to include a provision that will allow duty-free entry of garments into the US. But they have to be manufactured using cotton yarn sourced from America.
This clause was not explicitly mentioned in the initial joint statements or framework documents released after the interim pact. Goyal has now clarified that the benefit would be included in the final agreement’s detailed provisions.
He dismissed criticism and suggested that Bangladesh had secured a more favorable deal. The minister claimed that India would receive similar reciprocal advantages, particularly for textiles produced using US-origin raw materials.
If implemented the arrangement would give a competitive edge to Indian garment exporters, especially in comparison with regional players.
The US stands as one of India's major markets for its textile and apparel exports. The export volume for American cotton-based garment production could increase when zero-duty access for these products is granted. This will also support employment in the labor-intensive industry.
The textile industry had expressed concerns about losing market share after Bangladesh’s arrangement with the US.
Industry participants believe that parity in tariff benefits would help safeguard India’s position and protect millions of jobs linked to spinning, weaving, processing, and garment manufacturing.
The proposed textile benefit forms part of a broader interim trade deal between New Delhi and Washington.
US President Donald Trump announced a tariff reduction on Indian goods which will now be 18% instead of the previous 25% rate. The removal of the special duty that the US government imposed on India because of its Russian oil imports is also a great sign for the market.
While negotiations are ongoing officials suggest that further refinements and additional concessions may be included in the final pact.
The minister also pointed out that agricultural and marine exports could gain from parallel trade engagements with major economies, including the US, the European Union, and the UK.
Also Read: India–US Trade Deal: Apparel, Footwear, Machinery to See 18% Reciprocal Tariffs
Clarification on the final framework is expected to emerge in the coming weeks as discussions progress. If confirmed, the zero-tariff provision for garments made from US cotton may boost India’s textile exports and enhance its competitiveness in the global apparel market.