Record drop in cotton prices on Eid, Pakistan's textile industry in further trouble due to India's new policy

During the Eid-ul-Adha holidays, cotton and sorghum prices in Pakistan fell to a record low, contrary to expectations. According to Cotton Ginners Forum Chairman Ehsan ul Haq, the price of cotton in Sindh fell by Rs 2,000 to Rs 21,000 per maund and in Punjab by Rs 1,000 to Rs 22,000 per maund, while sorghum fell by Rs 1,500 to Rs 10,500 per 40 kg. The 10 cents per pound drop in the price of cotton in the global market also increased the pressure on the local market. Fears of further decline have also been expressed in the coming days.
The Punjab government has imposed a new tax on bringing cotton and sorghum from Sindh to Punjab, which has made the price in Punjab higher than Sindh.

Due to the depletion of domestic reserves, Pakistani textile mills are buying cotton in large quantities from America and Brazil. Last week, America sold a total of 112,000 bales, of which Pakistan bought the highest number of 68,030 bales.

The most worrying news comes from India’s new policy. India has abolished all 11 percent duties and taxes on cotton imports from June 1 to October 31. This will significantly increase Indian cotton yarn exports to China, which will open up another front of competition for Pakistani textile. It should be remembered that cotton yarn exports from India to China have reached 30,000 tons per month since November 2025, which was only 600 tons per month a year ago.

Ehsan ul Haq warned that due to heavy taxes, expensive energy and super tax in Pakistan, around 500 Ginning Factories and more than 150 Textile Mills are in a bad condition and there are fears of bankruptcy if relief is not provided in the new budget. APTMA and PCGA have demanded the government to reduce tax, energy and mark-up rates.