Pakistan mulls textile exporters’ request to import cotton from India

An employee working at a textile factory in Pakistan's port city of Karachi, on April 7, 2011. (AFP/FIle)

• Domestic cotton production has declined over the last few years, forcing Pakistan to import from US, Brazil and Uzbekistan
• Prime minister’s adviser on commerce says no decision reached yet as local exporters request allowing Indian imports for 4-6 months

KARACHI: As Pakistan’s textile sector faces a shortage of cotton yarn, local exporters have requested the government to allow them to import the commodity from India for at least four to six months, industry insiders said, with a top government official saying no decision on the matter had been taken as yet. 
Trade and diplomatic relations between the longtime nuclear-armed rivals deteriorated after India unilaterally revoked the special constitutional status of the disputed Jammu and Kashmir region in August 2019, with Pakistan downgrading diplomatic ties and suspending all kinds of trade with its eastern neighbor.
Last week, India and Pakistan agreed to observe a cease-fire agreement along the Line of Control — the de facto border between the Indian- and Pakistani-administered parts of Kashmir — after their senior military commanders communicated with each other on a military hotline. 
Pakistan currently only imports lifesaving drugs from India.
“Everything is up for discussion,” the prime minister’s adviser, Abdul Razak Dawood, told Arab News regarding the possibility of importing cotton from India. “No decision has [so far] been taken to allow import of cotton [from the neighboring country].”
“We approached the prime minister’s adviser on commerce, Abdul Razak Dawood, in February and shared our concerns with him regarding the shortage of raw material and its rising prices in the country,” said Ijaz Khokhar, chief coordinator of the Pakistan Readymade Garments Manufacturers and Exporters Association. 
“We have requested him to allow the import of cotton for at least a brief period of four to six months since that will allow us to deliver our export orders without delay,” he said, adding that the prime minister’s aide had “agreed to look into the matter.”
Pakistan has seen a reduction in its local cotton production over the last few years, though its textile sector continues to contribute about 60 percent to the country’s overall exports. Pakistan also consumes about 15 million bales of the commodity, though it is projected to produce about 5.5 million bales this year.
In this context, the textile sector meets its domestic demand by importing cotton from the United States, Brazil and Uzbekistan. 
“If Pakistan can allow import of medicines from India despite its diplomatic and security differences with that country, it can also import cotton through Wagha border,” Khokhar noted. “We cannot use Chinese cotton in our exports due to the US embargo. Our buyers closely monitor us.”
“The prices of the commodity have locally increased by 40 percent during the last two months,” he said, adding: “The import of cotton will also discourage the cartelization and hoarding of the raw material.” 
According to local exporters, the country’s yarn consumption had increased by about 25 percent due to the growth in value added exports that made hoarders and speculators jump into the market.
“Regional trade is important, and that also includes India,” Khurram Mukhtar, patron-in-chief of the Pakistan Textile Exporters Association, told Arab News. “Greater competition will lead to greater growth in our exports.” 
However, the Pakistan Textile Mills Association on Wednesday rejected the demand to import cotton from India.
“Allowing import of cotton yarn from India ... will create a crisis for the spinning industry of Pakistan and lead to the closure of spinning mills,” it warned in a statement, adding that the step would also “strengthen the economy and the spinning industry” of the neighboring country.
Independent analysts say there is no harm in importing cotton from India.
“Imports of cotton from India will be cheaper and the commodity will reach Pakistan within three to four days,” Naseem Usman Osawala, senior cotton broker and analyst, said. “It will ensure the availability of the raw material.”