CHENNAI: The textile industry has raised concerns over a sharp increase in cotton prices in the past two months and tightening domestic supply, along with heightened raw material and logistics costs, could adversely impact the industry, hard-hit by US tariffs last year.

Neeraj Jain, managing director of Vardhman Textiles, raised concerns about domestic supply during the company's latest earnings call and flagged the risk of a cotton shortage starting in August. Also, during the analyst call, Arvind Ltd's management said that higher input costs, especially from cotton prices, could exert pressure on margins in the first half of the year, and that it has proactively locked in long-term prices and secured a significant portion of raw materials to manage the inflationary environment. Exporting units of various sizes and industry bodies have demanded that the Union Government provide an exemption from 11% cotton duty at least till December amid a sharp rise in prices and a weakening rupee. Manufacturing units say the price hike pushes up the cost and makes them less competitive with other key hubs.