Pakistan has ordered approximately 206,000 bales of cotton from the United States and is boosting purchases from Brazil due to a decline in domestic output, as per a report. The country’s cotton and textile industry has shifted from decline to reliance, with import dependency rising following a significant drop in production. Recent estimates indicate an output of about 5 million bales, significantly lower than levels that previously sustained Pakistan’s self-sufficiency.
Shrinking cultivation area, poor seed quality, climate challenges, pest issues, and farmers favoring other crops like sugarcane, maize, and rice have contributed to the sharp decline in cotton production. Textile manufacturers, traditionally reliant on domestic cotton for raw materials, are now turning to imported lint and have requested tax relief from the government.
Producers are advocating for tax breaks, lower energy costs, and reduced levies, citing the sector’s inability to bear the costs of import dependence and weak local output simultaneously. The report underscores the magnitude and timing of imports, noting that Pakistan’s substantial bale import from the US constituted nearly the entire quantity sold in the country within a week, even before the local harvest.
The report cautions that the increasing reliance on cotton imports poses risks of widening the current account deficit and undermining Pakistan’s export-focused textile industry’s competitiveness. The sector is now caught in a cycle where the contracting cotton area leads to a loss of domestic supply for mills, a surge in imports, and a rise in foreign exchange pressure. This situation is attributed to inadequate seed regulation, inconsistent institutional support, weak extension services, and fluctuating pricing signals affecting domestic production.
