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India’s Cotton Conundrum: When Coverage Turns Farmers into Casualties

Renuka Chowdhury

27 August 2025: Cotton, India’s ‘white gold’, is not only a crop. It’s the lifeline of 60 lakh farmers, the muse of a 4.5 crore-strong textile workforce, and the thread that ties collectively India’s heritage of handlooms with its world aspirations in attire exports. But in the present day, this lifeline is fraying quick – not due to nature, however due to coverage.

On August 6, the US slapped a brutal 50% tariff on Indian cotton exports, a transfer that has left farmers, spinners and weavers observing catastrophe. As an alternative of cushioning this blow, the Indian authorities made a stunningly contradictory transfer: it scrapped the 11% import responsibility on overseas cotton, efficient August 19 to September 30.

In a single stroke, India opened the floodgates for affordable cotton imports from international locations like Australia and Egypt – whilst its personal farmers and exporters are set to break down beneath the double whammy of US tariffs and home worth crashes.

The quick influence was seen. Cotton costs fell by 4% inside days of the responsibility elimination. The Cotton Company of India slashed its worth benchmark by Rs 1,100 per bale. For farmers who have been already promoting under the minimal help worth (MSP), this was nothing wanting a demise knell.

Numbers that inform a grim story

Round ten lakh farmers in Telangana alone are on the brink, with every of them standing to lose tens of 1000’s of rupees this season. Rs 74,648 crore value of cotton and garment* exports to the US now face being worn out by tariffs. India’s cotton manufacturing has already fallen 24% over the past decade, whereas imports have surged 73%.

Thirty-five lakh handloom weavers – custodians of India’s cultural cloth – stand to lose livelihoods as mills slash yarn purchases.

Throughout sectors, India might lose $25.3 billion (Rs 2.17 lakh crore) in exports to the US due to the 50% tariff, with textiles alone bearing almost half that burden.

And let’s not neglect the chilling human toll: in a rustic the place 31 farmers or farm staff die by suicide day by day, one other spherical of worth crashes might flip a disaster right into a disaster.

Hole rhetoric vs harsh actuality

The prime minister has boasted about being able to “pay a heavy private worth” to guard Indian farmers. However farmers don’t want rhetoric; they want remunerative costs. They want MSP based mostly on the Swaminathan Fee’s C2+50% components – Rs 10,075 per quintal. As an alternative, they’re supplied solely Rs 7,710 for medium staple cotton.

That Rs 2,365 hole per quintal is not only a quantity; it’s the distinction between survival and despair.

In the meantime, the federal government’s determination to raise import duties reveals a surprising inconsistency. On the one hand, it claims to “Make in India”. On the opposite, it paves the best way for cheaper imports that can crush Indian producers. Who advantages? Not the farmer. Not the weaver. Solely merchants and importers who revenue from arbitrage whereas the annadata drowns in debt.

A sector too large to fail

Cotton and textiles usually are not a distinct segment. They’re among the many largest employers in India, sustaining 4.5 crore livelihoods. In 2024-25, India exported Rs 74,648 crore value of cotton yarn and materials and clothes* to the US. With tariffs chopping that almost in half, an estimated one lakh staff might lose their jobs within the coming months.

This isn’t nearly commerce deficits or steadiness sheets. It’s about tens of millions of rural households whose every day bread is dependent upon spinning mills, dyeing models, powerlooms and handloom cooperatives. When coverage reduces them to collateral harm, the results ripple far past the fields.

The worldwide context

The irony is sharp. The US – which pushes free commerce when handy – has weaponised tariffs in opposition to India’s labour-intensive sectors. However India’s response has been to import extra, not negotiate tougher. Nations like Bangladesh and Vietnam, backed by constant authorities help, are able to eat into India’s market share. Each bale of Australian cotton getting into India duty-free is one much less purchaser for a struggling Indian farmer.

What wants to vary – now

India’s cotton disaster isn’t inevitable. It’s political. And it calls for pressing course correction.

Three steps are vital: first, assure remunerative costs. The MSP should be instantly revised consistent with the Swaminathan components. Procurement needs to be assured – not theoretical. If farmers know they’ll not less than get Rs 10,075 per quintal, they will survive the export disaster.

Second, diversify export markets. Overdependence on the US has left India uncovered. The federal government should aggressively negotiate entry to new markets – from ASEAN to Africa – and defend exporters from tariff shocks.

Third, reduction packages for cotton states. Maharashtra, Gujarat and Telangana – India’s cotton heartlands – want focused reduction. This contains direct revenue help, debt waivers the place crucial and credit score at concessional charges. The agricultural economic system can’t be allowed to break down beneath a burden not of its making.

Past cotton – a bigger warning

The cotton story is not only about one crop. It’s about India’s financial technique. For a decade, insurance policies have oscillated between nationalist slogans and neoliberal openings, usually leaving the farmer on the shedding finish. Eradicating import duties whereas farmers bleed isn’t a method. It’s abdication.

India can not aspire to be a world textile hub whereas betraying its personal producers. It can not have fun khadi and handlooms on podiums whereas suffocating the very weavers who hold these traditions alive. It can not, in good conscience, ignore the plight of farmers who develop what the world wears.

The thread that should not break

Cotton is greater than commerce. It’s dignity, survival and heritage. It garments the nation and carries its tradition overseas. To permit it to be undermined by incoherent insurance policies is to fail not simply farmers however the very cloth of India’s economic system.

If the federal government actually needs to “pay a heavy worth”, let it not be borne by the farmer. Let it bear the political value of daring, farmer-centric reforms. As a result of each thread of cotton left unsold, each loom left silent, each farmer left unheard – is a tear within the nation’s conscience.

*Readymade clothes of all textiles.

[Renuka Chowdhury is a Rajya Sabha MP from the Indian National Congress and former Union cabinet minister. Courtesy: The Wire, an Indian nonprofit news and opinion website. It was founded in 2015 by Siddharth Varadarajan, Sidharth Bhatia and M. K. Venu.]

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By Ending Import Obligation on Cotton Amid US Stress, Modi Govt is Sacrificing the Pursuits of Indian Farmers

Indra Shekhar Singh

20 August 2025: With simply days remaining for a brand new cotton harvest the Modi authorities has determined to reward the Prime Minister’s and “India’s pal Do-land Trump” (Donald Trump) our cotton farmers. Apparently, beneath the US’s strain of fifty% tariffs, India has determined to take away 10% import responsibility on cotton from nineteenth August to September thirtieth 2025. This import responsibility successfully elevated the worth of overseas grown cotton by 11%.

Apparently, the elimination of the import responsibility comes inside a fortnight of Prime Minister Narendra Modi had mentioned that India won’t ever compromise on the curiosity of farmers.

Addressing the MS Swaminathan Centenary Worldwide Convention in Delhi, Modi had mentioned on August 7 in Hindi, “Farmers’ curiosity is our high precedence. India won’t ever compromise on the curiosity of farmers, fisherfolks and dairy farmers. Personally, I do know that I must pay an enormous worth for this, however I’m prepared for it.”

The elimination of import responsibility and the 40 day rest for overseas cotton importers is being welcomed by industries as they get entry to cheaper cotton for his or her machines, and additional pushes the native costs down. In the meantime the federal government loses round Rs. 170 crore in income.

Whereas the Cotton Company of India (CCI) endorses this import responsibility elimination, in actuality they could endure upwards of Rs. 700 crores reportedly from beforehand held cotton shares from final years. This transfer additionally has a huge effect on native merchants who’ve withheld their cotton shares from final yr hoping for greater costs this yr.

However why will they endure losses? The brand new dumping of primarily US cotton will destroy native costs, as a result of cotton will likely be in over-supply and overseas cotton will be capable of problem the native farmers as a result of discount of the import responsibility.

At present CCI’s promoting fee for cotton is between Rs. 56,000 to 57,000 per sweet (355.6 kg) whereas after the elimination of the responsibility imported cotton will tentatively value between Rs. 50,000 to Rs. 51,000 per sweet. Now cotton minimal help worth (MSP) for the present harvest was alleged to be Rs 61,000, however with the brand new imported inventory, cotton farmers must be fortunate to realize this worth realisation.

It’s reported that sources inside the textile ministry opposed the elimination of import responsibility, however the trade is singing praises for this transfer as a result of it will get them cheaper overseas cotton and break the home market worth by not less than Rs 6,000. Plus it additionally kills any probability of market costs going past the projected MSP.

Laissez-faire or fare commerce?

For a second now lets see this from the farmers’ perspective. The cotton cultivating areas of Telangana, Maharashtra, Punjab, and many others in India are one of many highest indebted area within the nation, surprisingly a really excessive proportion of all farmers’ suicides are from the cotton rising belts, with Marthawada and Vidarbha topping the checklist on farmers suicides. A particular investigation workforce of the Maharashtra authorities termed even referred to as “Bt cotton as a killer crop” as a result of it’s answerable for the utmost variety of useless farmers.

In recent times, affected by erratic climate and better enter prices, cotton farmers have been demanding a better MSP for cotton from Punjab to Maharashtra. However as an alternative of serving to them out, the Modi authorities has sacrificed them for the larger take care of the Trump administration.

In the meantime within the US, President Trump is successful hearts amongst his farmer voters by creating new markets for American commodities. He’s appearing in alignment with age outdated overseas coverage goal of the USA, “discover markets for US surpluses”. However that isn’t all, the US authorities is giving a large subsidies to its cotton growers.

In 2024, the US authorities gave $9.3 billion in subsidy funds to farmers for commodity crops. Subsidies made up 5.9% of whole farm earnings that yr, with probably the most funding going to corn, soybeans, and cotton. Moreover it was reported that the “US disbursed $40.10 billion in cotton subsidies throughout 1995-2020”. The influence of the US subsidies was so enormous that it titled the worldwide cotton costs to Uncle Sam’s liking. For instance in 2011 US cotton growers obtained a $24 billion subsidy.

Moreover, Trump administration introduced $60 billion in subsidies for farmers over the subsequent decade within the current tax invoice and there may be excessive chance of US growers getting export subsidies or revenue help to make their commodities extra aggressive within the world market.

So, mainly the Trump administration is artificially subsidising US agri merchandise making them cheaper after which dumping them on growing international locations to interrupt the native markets. The case of cotton is sweet instance, as India, which is among the largest producers of cotton, has to now settle for US cotton beneath geopolitical strain and has to sacrifice her cotton farmers for potential beneficial properties with the Trump administration. Whereas Trump empowers their farmers, Modi authorities is sacrificing our most weak farmers.

Politically talking this might even have a huge impact on the recognition of the areas that are thought-about because the strongholds of the Rashtriya Swayamsevak Sangh (RSS). Maharashtra is a significant hub of RSS backed politicians, and a worth crash might instantly influence the politicians in search of votes from the cotton farmers. Massive political leaders like Devendra Fadnavis, Nitin Gadkari, and many others. who’re thought-about near the RSS, could possibly be the direct collaterals to this coverage.

Genetically modified cotton varieties could possibly be menace to biodiversity

However that isn’t all, beneath the specter of tariffs could possibly be lurking the subsequent problem of opening our fields to 3rd and fourth era genetically modified cotton varieties markets by US based mostly firms like Monsanto. This could possibly be the subsequent large assault on our biodiversity and cotton farming.

One ought to remember that the BT cotton varieties are toxin producing seeds that are bio engineered to provide a identified toxin referred to as bacillus thuringensis (bt) which could possibly be devastating to biodiversity and the meals system. The newer generations of GMO additionally require in depth use of carcinogenic pesticides. The Bt cotton seeds wind up in our meals system by way of the use in depth use in cottonseed oil which is now getting used extensively in making of commercial namkeens, chips, and different snack and meals gadgets.

As soon as the tariff sport begins to work favourably for the Trump administration, he will certainly select an America first coverage which might empower not solely American farmers but additionally American companies.

The query now stays what can the Modi authorities do to stop this hostile takeover of our farmers, import coverage and nationwide sovereignty, from the present standpoint – solely acquiesce.

[Indra Shekhar Singh is an independent agri-policy analyst and writer. Courtesy: The Wire, an Indian nonprofit news and opinion website. It was founded in 2015 by Siddharth Varadarajan, Sidharth Bhatia, and M. K. Venu.]

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AIKS Calls Upon Farmers to Protest Determination to Scrap 11% Import Obligation on Uncooked Cotton

Sabrang India

23 Aug 2025: The All India Kisan Sabha (AIKS) has condemned the choice of the RSS-BJP led union authorities to scrap the 11% import responsibility on uncooked cotton. The choice, notified by the Central Board of Oblique Taxes and Customs (CBIC) is legitimate from August 19 till September 30, 2025. In line with the AIKS, this determination will end in a discount within the worth of imported cotton which, in flip, will push costs of home cotton downwards. Small cotton producers in India can not compete with giant, industrial-scale cotton farmers of america who’ve traditionally obtained huge authorities subsidies.

In line with the CPI-M affiliated mass organisation of farmers, the AIKS, the quick influence of this determination will likely be significantly extreme as farmers in most cotton-growing areas have already sown their crops virtually two months again and have sunk important prices in anticipation of getting remunerative costs for his or her produce. This transfer to scrap import duties comes at a very unhealthy time as farmers put together to reap their crop. Cotton-growing areas of India are infamous for agrarian misery and demise by suicides by farmers. The most recent coverage determination will additional push cotton farmers into indebtedness and worsen the financial misery.

The assertion additionally states that it’s ironic that this anti farmer determination was adopted by Prime Minister Modi’s Independence Day speech wherein he mentioned that he’s “standing like a wall in opposition to any adversarial coverage that might influence Indian farmers, fisherfolk and cattle keepers” and “India won’t ever compromise the pursuits of Indian farmers, fisherfolk and cattle keepers”. Modi’s constant professional imperialist insurance policies couldn’t make sure the safety of India’s pursuits within the tariff struggle initiated by Trump. The US has declared a greater than 50% tariff on India’s textile exports. To handle the scenario, Modi has determined to punish Indian cotton farmers who’re the weakest hyperlinks within the world provide chain.

Lastly, the AIKS states that “the neoliberal period has witnessed the squeezing of Indian cotton farmers from the enter and output aspect by the state-capital nexus. In his 11 yr tenure because the prime minister, Modi by no means gave MSP to the cotton farmers on the really useful fee of C2+50. As an illustration, the Fee for Agricultural Prices and Costs (CACP) introduced MSP for cotton within the 2025 Kharif season is Rs.7710 per quintal. If the C2+50 components was used, it will have been Rs.10075 per quintal. To place it in a less complicated means, Indian cotton farmers are presently receiving Rs.2365 much less per quintal as MSP. This itself is a transparent betrayal of the farmers. If the cotton worth is additional declining, it will likely be outright looting of the farmers.”

“The duplicity of US lobbying with the Indian authorities to cut back state help to the Indian cotton farmers is nicely documented. It has been estimated that, within the US, authorities subsidies are as excessive as 12 per cent of the whole worth of manufacturing of cotton whereas in India, authorities help to cotton farmers is about 2.37 per cent of the worth of manufacturing. This huge disparity in ranges of state help is on the core of the benefit US cotton farmers have over cotton producers in growing international locations.”

It’s the huge disparity in ranges of presidency help and the massive distinction in scale of manufacturing of farmers within the US and India mix to place Indian farmers at an enormous drawback, explains the assertion by the AIKS launched by its President, Ashok Dhawale and Normal Secretary, Vijoo Krishnan.

The AIKS additionally factors out that it’s essential to do not forget that the US authorities is placing strain on India to equally open Indian markets to different farm merchandise from the US. Except farmers make it clear to the Indian authorities that such anti-farmer choices won’t be tolerated, it’s doubtless that the Modi authorities will succumb to the US strain and take such choices for different crops as nicely. Therefore, the AIKS has referred to as upon all farmers to come back collectively and launch an intense agitation to pressure the federal government to reverse this determination.

[Courtesy: Sabrang India, an online portal dedicated to fighting the cancer of divisive politics. It is edited by Teesta Setalvad and Javed Anand.]