The government is vetting a proposal to levy a minimum export price on cotton yarn, a first-of-its-kind move to protect domestic textile makers. Here is what is happening.

Cotton yarn prices have surged about 60 per cent, from roughly Rs 250 per kg in early 2026 to nearly Rs 400 per kg now. The spike is squeezing garment makers who use yarn to produce fabrics and clothes.

The surge followed US restrictions on cotton from China’s Xinjiang region over forced-labour allegations. Global buyers shifted to Indian cotton and yarn, pushing up exports to countries like Bangladesh and Vietnam and tightening domestic supply.

Industry body AEPC has urged the government to regulate yarn exports, particularly of 20s count and above. It argues India should prioritise value-added garment exports, which earn Rs 800-1,200 per kg, over raw yarn at Rs 325 per kg.

The textiles ministry is in talks with apparel makers facing delivery deadlines. ‘We are in discussions with apparel manufacturers,’ an official told Mint. A minimum export price would make exports costlier, keeping more yarn at home.