Cotton industry representatives are demanding a comprehensive audit after alleging that under-invoiced fabric imported under the Export Facilitation Scheme is finding its way into Pakistan’s domestic market, undercutting local manufacturers already grappling with collapsing cotton output, volatile prices and rising production costs. At the same time, heavy monsoon rains and the risk of flooding now hang over the standing crop, adding another layer of uncertainty to an industry that has spent years lurching from one crisis to the next.
The controversy over imported fabric, however, is only the visible symptom of a much deeper malaise. Pakistan’s cotton crisis did not begin at the customs gate. It began in the fields, where the country’s once-prized “white gold” has steadily lost both acreage and ambition. Cotton is not simply another crop. It is the backbone of the largest export industry, connecting millions of farmers, ginners, spinners, weavers and garment manufacturers in a single economic chain.
Pakistan once harvested around 14 million bales of cotton annually. Today, production has fallen to roughly 6.85 million bales, barely half its historical peak and well below official targets. The consequences have been profound. The country has gone from clothing the world with its own raw material to importing increasing quantities of cotton simply to keep its textile industry running. The Overseas Investors Chamber of Commerce and Industry estimates that the decline is costing the country between $2 billion and $3 billion every year through additional imports and lost export earnings.
It is tempting to blame climate change alone, but that would let policymakers off too easily. Prolonged heatwaves, canal water shortages, erratic rainfall and pest attacks have damaged crops across Punjab and Sindh. Yet climate change has amplified, rather than created, the crisis.
An ordinary cotton farmer is not abandoning the crop out of sentiment. He is responding to economics. Rising prices for fertiliser, diesel, pesticides and electricity have steadily eroded profitability. Access to quality seed remains inconsistent, research into climate-resilient and pest-resistant varieties has lagged, and extension services remain inadequate. Delayed returns and policy uncertainty have encouraged many growers to switch to crops that offer quicker, more predictable income, particularly sugarcane, despite its far heavier water footprint.
The recent surge in cotton prices should not be mistaken for recovery. Organic cotton prices have risen by around 3.75 per cent because of shortages of seed cotton, while lint prices have swung sharply in recent weeks. Scarcity-driven price increases are not a sign of prosperity. They are a symptom of a supply chain under strain, squeezing textile manufacturers, eroding export competitiveness and eventually raising costs across the economy.
Allegations concerning fabric imported under the Export Facilitation Scheme still warrant a credible and transparent investigation. If loopholes are being exploited, they must be closed without delay. But even a perfectly enforced scheme cannot compensate for years of systemic decline.
Pakistan cannot build a globally competitive textile industry while neglecting the crop that sustains it. *