Cotlook Index: 06-11-2026
90.40 (+0.50)
US-India Trade Deal Faces Fresh Uncertainty Amid Political Shifts in Washington
Friday, 6th Nov. 2026, (Source: www.textilevaluechain.in/)
Democratic gains in the US Congress could complicate the proposed FTA's progress, while tariff disputes, agricultural sensitivities and competition with Asian exporters remain key issues in negotiations. The proposed Free Trade Agreement (FTA) between India and the United States could face further delays amid political developments in Washington and continuing differences over trade policies. Although negotiations have shown signs of progress, disagreements over tariffs, market access and sensitive agricultural sectors remain significant challenges to finalising the agreement. Political Developments Add Uncertainty to India-US FTA The Democratic Party is now convincingly holding sway in both the House of Representatives and the Senate, a development that could influence US domestic and foreign policy decisions. However, trade agreements, including the proposed India-US FTA, remain within the US President's domain without requiring congressional approval. This raises the possibility that there may be limited changes to the broad direction of the trade agreement already under discussion. Despite considerable opposition among US consumers, who believe higher tariffs have contributed to increased living costs, the Trump administration's approach to tariffs may continue to receive support in Congress. The forthcoming trade agreement could therefore remain largely unaffected by the political developments in Washington. India-US trade relations have also experienced uncertainty under previous administrations. The Biden administration showed limited interest in negotiating an FTA with India, while Section 301 of the US Trade Act was invoked against the country under both the Clinton and Obama administrations. The political upheavals in Washington have nevertheless added uncertainty to the announcement of the FTA's first phase, which has already been under discussion for a considerable period. Talks began in February 2025 and were initially expected to be among the first agreements completed after Donald Trump returned to the White House. However, negotiations have encountered several obstacles. Tariff Disputes Continue to Complicate Negotiations The tariff situation has added another layer of complexity to the discussions. In August, tariffs on Indian exports to the US increased to 50%, including a 25% penalty duty linked to India's imports of Russian oil. This followed the imposition of additional duties under the Trump administration's tariff framework. The situation became more complicated after US courts ruled against Trump's reciprocal tariff regime. An interim framework agreement for the proposed trade deal was subsequently unveiled in February this year. The negotiations appeared to be approaching a conclusion before encountering further uncertainty. The Lindsey Graham law, which allowed Donald Trump to impose tariffs of up to 10% on countries importing oil from Russia, was expected to remain a potential obstacle. However, the US President later granted a temporary waiver under the law. At present, Indian merchandise exports face tariffs under the World Trade Organisation's (WTO) most-favoured-nation (MFN) system, along with a 10% tariff under the US Trade Act. Recent statements from both sides have indicated that the trade agreement is moving closer to completion. These assurances were intended to address concerns about prolonged delays, particularly as the US has concluded trade arrangements more quickly with several other Asian economies, including Indonesia, Bangladesh and South Korea. India Needs a Gradual and Balanced Trade Agreement For India, both dairy and agriculture are politically sensitive sectors, making a gradual and carefully negotiated trade agreement important. India needs to protect domestic industries from a potential increase in imports while ensuring that the agreement delivers meaningful export opportunities. The US is India's second-largest trade partner. Bilateral trade was estimated at $141 billion in 2025, compared with $151 billion in India-China trade. More importantly, India maintains a trade surplus with the US. The agreement is therefore considered important for strengthening India's competitive position against Asian exporters such as Bangladesh, Vietnam, Indonesia and China. Textiles, Garments and Industrial Goods Among Potential Beneficiaries One of the key advantages of a trade agreement would be the possibility of lower tariffs in product categories where Indian exporters face strong international competition. Textiles and garments are among the important sectors in this regard, particularly as competing countries such as Bangladesh currently benefit from lower duties. Other segments that could gain from improved market access include gems and jewellery, industrial products, chemicals and engineering goods. Exporters in these categories are looking towards the possibility of accessing the US market under zero-duty arrangements. However, greater access to the Indian market remains a key US negotiating objective, particularly in sectors that have traditionally been subject to restrictions. Agriculture and Dairy Remain Major Negotiating Challenges
The US is seeking greater access to India's market in areas such as dairy and agriculture, where imports remain tightly controlled. These sectors represent important political and economic concerns for India because the livelihoods of millions of farmers depend on them. The situation differs considerably from the US, where farming is highly corporatised and economies of scale help reduce per-unit costs. The interim trade agreement indicated that some areas could be opened to greater imports. These include tree nuts, fruits, spices and non-GM sorghum. However, staple grains, bulk daily-consumption commodities and soybean remain unresolved areas. India is expected to maintain its red lines in these sensitive segments. Energy Purchases and Trade Commitments Form Part of the Discussions Despite the remaining differences, the trade surplus between India and the US is expected to narrow to some extent. The negotiating process has included India's purchases of US crude oil and petroleum products such as LPG, which are required amid the West Asian crisis. Under the agreement, India committed to purchasing goods worth $500 billion over a five-year period. These purchases include commodities such as oil and coking coal, along with high-technology equipment. Export Growth Provides Some Confidence Despite Tariffs Concerns surrounding the proposed FTA have been partly offset by developments in India's export performance. The first positive indicator is a 15% increase in Indian exports to the US during the first half of 2026-27, despite the imposition of higher tariffs. The second is an 18% rise in India's overall exports during the same period. These figures have provided some confidence that export growth can continue despite unfavourable external conditions. Final Outcome of India-US FTA Remains Uncertain Whether the proposed trade agreement with the world's largest market will ultimately benefit India cannot be determined conclusively until the details are made public. The outcome will depend considerably on the comparative advantages available to Indian exporters. In particular, the extent to which Indian goods receive a competitive advantage over similar products supplied by other exporting countries will remain a critical factor. Despite the recent political developments in the US Congress, several important aspects of the proposed agreement remain unresolved. The final terms of the FTA will determine whether India can strengthen its position in the US market while protecting sensitive domestic sectors.
Will the India-New Zealand FTA deliver on its promise?
Sunday, 8th Nov. 2026, (Source: www.fibre2fashion.com)
Insights
India–New Zealand FTA took effect on October 20, 2026, giving Indian exporters duty-free access across all New Zealand tariff lines.
India has offered concessions on about 70 per cent of lines, including wool, while dairy, sugar and edible oils remain excluded.
Textiles, apparel, carpets, home, sustainable and technical textiles may gain, but compliance and freight costs remain hurdles.
The India–New Zealand Free Trade Agreement (FTA) entered into force on October 20, 2026, giving Indian exporters duty-free access to the New Zealand market across all tariff lines. India, in turn, has reportedly extended tariff concessions across about 70 per cent of its tariff lines, covering products such as wool, wood, coal, and wine while dairy, sugar, and edible oils reportedly remain excluded. Certain other agricultural products also reportedly receive preferential access subject to quotas and safeguards. Meanwhile, reports citing an analysis suggest that around 58.3 per cent of New Zealand’s tariff lines were already duty-free, limiting the additional advantage for some Indian exporters. Regulatory compliance seems another consideration. Exporters will reportedly need to comply with the FTA’s rules of origin and applicable product-specific standards, labelling, and certification requirements. These obligations may add documentation and compliance costs, particularly for businesses unfamiliar with the New Zealand market. These requirements may pose a greater relative burden for micro, small and medium enterprises (MSMEs) that lack dedicated export-compliance teams or have limited resources for certification, documentation, and overseas market research. Some stakeholders have also highlighted the importance of market size and competition. New Zealand’s relatively small population limits its overall consumer-market scale compared with larger export destinations. Indian exporters will therefore need to identify commercially attractive product segments and build reliable relationships with local buyers.Meanwhile, thanks to the distance between the two countries, long shipping distances may increase freight costs and transit times, potentially reducing some of the price advantage created by tariff concessions, feel some experts, and smaller exporters and businesses handling time-sensitive products may be particularly exposed to these costs. Indian firms will still also need to compete with established suppliers on price, product quality, design, and delivery reliability. Depending on the product and buyer, sustainability credentials may also influence purchasing decisions. Textiles, apparel, leather, footwear, carpets, ceramics, engineering goods, and automotive components are among the sectors poised to benefit significantly from the deal. According to the Confederation of Indian Textile Industry (CITI), the agreement offers an opportunity to diversify export markets, reduce dependence on a handful of destinations and strengthen the long-term competitiveness of India’s textile industry. Higher-value segments, including home textiles, sustainable textiles and technical textiles, offer potential avenues for expansion. Duty-free access could also help Indian manufacturers broaden their product offerings and establish stronger relationships with the buyers in New Zealand. However, converting improved market access into sustained export growth will also depend on quality, delivery timelines, and other buyer requirements. Access to New Zealand wool could create opportunities further along the value chain. By combining imported wool with India’s established spinning, weaving, processing, and manufacturing capabilities, businesses could develop value-added products for domestic consumption and export markets. This would add a supply-chain dimension to the agreement, complementing the opportunities created by improved access for Indian finished goods. The Apparel Export Promotion Council (AEPC) expects duty-free access to improve the price competitiveness of Indian apparel, create opportunities for increased export orders and support employment generation, particularly among MSMEs. For smaller manufacturers, the agreement offers an opportunity to reach new buyers without the additional cost burden previously imposed by import duties. Established manufacturing clusters such as Tiruppur, Ludhiana, Surat and Panipat can leverage the agreement to strengthen their presence in the New Zealand market. Their existing manufacturing capabilities, product specialisation, and export experience provide a foundation for responding to demand across apparel, textiles, and home textiles. An increase in export orders could generate opportunities across the supply chain, benefiting manufacturers, processors, ancillary units, and workers.Beyond bilateral trade, the agreement could also provide a potent platform for Indian businesses to explore opportunities across wider Oceania and the Pacific Island regions. The India–New Zealand FTA, therefore, opens up new opportunities for exporters across sectors, but the extent of its overall benefits, many feel, will also depend on how effectively businesses convert tariff concessions into actual trade gains.
Indian Cotton Prices Strengthen on Mill Buying
Friday, 7th Nov. 2026, by Yash Chouhan, (Source: www.smartinfoindia.com)
Indian Cotton Market: Mill Buying Supports Prices; Weak Yarn Demand Limits Upside
In the Indian cotton market, prices have strengthened across key hubs in Gujarat and North India. Following a recent decline, spinning mills have resumed purchasing and are actively replenishing their stocks. However, the scope for any significant price surge remains limited due to weak demand for cotton yarn and the anticipated increase in the arrival of the new crop.Cotton Prices Strengthen in Gujarat and North India Spot cotton prices have improved across various markets in Gujarat, including Ahmedabad. Prices have also strengthened in Punjab, Haryana, and Rajasthan, driven by increased procurement by mills. Mills are building up their raw cotton inventories to meet requirements ahead of the upcoming peak consumption season. Recent buying activity has eased the pressure for distress sales in the market. Nevertheless, demand for cotton yarn remains sluggish in both domestic and international markets. Yarn prices for November are hovering near the levels seen at the end of October, making it difficult for mills to pass on the rising costs of raw cotton to their customers.Supply and Demand Dynamics Procurement by mills has been the primary factor providing short-term support to cotton prices. Taking advantage of lower price levels in recent weeks, spinning mills and textile manufacturers have increased their stock holdings. This has tightened availability in the spot market, leading to an improvement in prices at the ginning and trading levels.India’s cotton production for the 2026-27 season is expected to decline due to adverse weather conditions and lower yields in major producing regions. According to preliminary estimates from the Cotton Association of India (CAI) and other trade bodies, production could hover around 28–29 million bales (of 170 kg each). Some projections indicate a decline of more than 10% compared to the previous season. Market Outlook The central government has extended the customs duty exemption on raw cotton imports until the end of December 2026. This provides mills with an import option should domestic prices rise. Meanwhile, procurement by the Cotton Corporation of India (CCI) and the Minimum Support Price (MSP) mechanism may offer additional support to the market. The arrival of the new crop and weather conditions will determine the market's direction. As harvesting and ginning activities gain momentum, arrivals in the mandis (agricultural markets) are likely to increase, which could temper the current upward trend. Overall, cotton prices are expected to remain stable with only modest gains, rather than experiencing a significant surge, in the near term.
CCI Cuts Cotton Prices by ₹400 per Candy; Weekly Auction Sales at 26,000 Bales
Friday, 7th Nov. 2026, by Yash Chouhan, (Source: www.smartinfoindia.com)
CCI Decrease Its Cotton Candy Prices by ₹400 per Candy; Weekly Auction Sales Reach 26,000 Bales The Cotton Corporation of India (CCI) decreases its cotton selling prices by ₹400 per candy during the week ended 06 November 2026. During the week, the corporation sold approximately 26,000 bales of cotton from the 2025–26 crop through its auction sales.
Day-Wise CCI Auction Sales Performance
November 2, 2026 (Monday)
CCI recorded its highest sales of the week, with approximately 25,600 bales sold in a single day. Mills purchased 18,900 bales, while traders accounted for 6,700 bales.
November 3, 2026 (Tuesday)
No cotton sales were recorded during the day's auction sessions. Both mill and trader purchases remained at zero.
November 4, 2026 (Wednesday)
Auction activity remained subdued, with CCI selling just 400 bales. The entire quantity was purchased by mills, while traders did not participate in purchases.
November 5, 2026 (Thursday)
No sales were recorded through either the mill or trader sessions
November 6, 2026 (Friday)
CCI again recorded zero sales, with no purchases reported from mills or traders.
Cumulative Cotton Sales
Following the latest auction activity, CCI's cumulative cotton sales for the 2025–26 season reached approximately 99.59 lakh bales, reflecting continued auction activity in the domestic cotton market.
Bangladesh's import bill rises 11.5% in Q1 FY27
Monday, 9th Nov. 2026, (Source: www.fibre2fashion.com)
Insights
Bangladesh's import payments rose 11.50 per cent year-on-year to $18.91 billion in Q1 FY27, while new letters of credit climbed nearly 22 per cent to $22.46 billion.
Petroleum imports increased nearly 28 per cent, but industrial raw material imports fell 1.80 per cent and capital machinery was almost unchanged.
Bangladesh Bank officials expect obligations to rise ahead of Ramadan.
Bangladesh’s actual imports, measured by the settlement of letters of credit (LCs), rose 11.50 per cent year-on-year to $18.91 billion in July-September of fiscal 2026-27 (FY27), compared with $16.96 billion in the same period of FY26, according to the latest Bangladesh Bank data.Fresh LCs, which indicate new import orders, increased by nearly 22 per cent to $22.46 billion in the first quarter of FY27 from $18.43 billion a year earlier, the central bank data showed. Production-linked import categories showed mixed movement. Imports of capital machinery, or industrial equipment used in production, were almost unchanged at $435 million in July-September FY27. Industrial raw material imports fell 1.80 per cent to $5.71 billion from $5.82 billion a year earlier, while intermediate goods imports rose nearly 36 per cent to $1.29 billion from $0.95 billion, according to the data. Petroleum product imports rose more sharply, increasing nearly 28 per cent to $2.98 billion in Q1 FY27 from $2.33 billion in the corresponding period of FY26. In FY26, fuel oil imports had increased 6.42 per cent to $10.68 billion from $10.03 billion in FY25, the central bank data showed. Bangladesh Bank officials expect import-payment obligations to rise further in the coming months, particularly before Ramadan, after the country spent an additional $1.0 billion in October 2026 to settle public-sector import bills, mainly for fuel oil, gas and electricity. Higher global prices of essential commodities, especially fuel, have lifted the country’s overall import expenses, Bangladeshi media reported, citing the officials.The World Bank Group has projected a 23 per cent increase in global commodity prices in 2026 as geopolitical and other global shocks intensify, according to its latest Commodity Markets Outlook.The outlook said the Middle East conflict had depleted oil inventories and was expected to push energy prices to a four-year high. Energy prices are projected to rise 32 per cent in 2026, reversing three years of declines, before easing in 2027. Brent crude is forecast by the World Bank to average $91 per barrel in 2026, up from $69 in 2025, before easing to $79 in 2027.
