Decline in cotton production: Pakistan faces risk of over $2 billion import burden
Published 9 days ago | By Nouman Shakeel
The continuously declining cotton production has compounded difficulties for Pakistan's agricultural economy, textile industry, and exports. Mian Zahid Hussain, Chairman of the FPCCI Policy Advisory Board, has urged the government to provide immediate relief to the cotton sector and take emergency measures to safeguard cotton-growing zones.
Supporting the demands of cotton ginners, Mian Zahid Hussain stated that cotton is vital to the country's agricultural economy and exports; however, the persistent drop in its production is harming the economy.
Widening Gap Between Production and Imports
He noted that, according to a recent report by the US Department of Agriculture, Pakistan's cotton production for 2026-27 is projected to stand at 4.9 million bales, whereas the production target had been set at 9.6 million bales. Meanwhile, the local spinning industry requires approximately 10 million bales of cotton annually.
To bridge this gap, Pakistan may need to import over 5 million bales, valued at approximately $2 billion (or PKR 600 billion). According to Mian Zahid Hussain, this expenditure would benefit foreign farmers rather than Pakistani ones and place additional strain on the country's foreign exchange reserves.
Data from the past few fiscal years regarding cotton production and imports also illustrates this shifting situation:
| Fiscal Year | Cotton Production | Cotton Imports |
|---|---|---|
| 2023-24 | 7 Million Bales | 3.2 Million Bales |
| 2024-25 | 5 Million Bales | 6.1 Million Bales |
| 2025-26 | 5.6 Million Bales | 6 Million Bales |
| 2026-27 (Expected) | 4.9 Million Bales | 5+ Million Bales Required |
Reduction in Cultivation Area: A Major Issue
According to Mian Zahid Hussain, a primary reason for the decline in cotton production is the approximately 33% reduction in the area under cultivation over the past decade. He noted that this situation has adversely affected Pakistan's economy and exports, even as the population grows by 6 to 7 million people annually.
He also identified industrial production costs as a critical issue. He pointed out that electricity prices in Pakistan are higher compared to regional countries; while industries elsewhere pay around 8 cents per unit, the rate in Pakistan reaches up to 14 cents per unit.
Demand for Relocation of Sugar Mills and Tax Abolition
Mian Zahid Hussain demanded the immediate relocation of sugar mills situated within designated cotton zones. He argued that permitting sugar mills in these areas has harmed the cotton cultivation area and overall production capacity.
He further called for the abolition of sales tax on cotton, cottonseed, and cottonseed cake; a reduction or elimination of fixed charges and taxes included in electricity bills; and the full implementation of the Cotton Control Act.
He emphasized the need for effective measures—beyond merely protecting cotton zones from the encroachment of other crops and unrelated industries—to ensure the supply of quality seeds, protection against diseases, and improved production standards.
Proposal for Industrial Facilities for the Ginning Sector
Mian Zahid Hussain urged the government to work on an emergency basis to implement the "Grow Cotton, Save Economy" campaign proposed by the PCGA. According to them, granting industrial status to the ginning sector could enable the provision of electricity and gas at industrial rates.
They warned that if immediate support is not extended to the cotton sector—including the ginning and textile industries—and if farmers are not provided with modern, climate-resilient seeds, Pakistan’s share in the global market could suffer further, potentially leading to an escalation in employment-related issues.
