Growing cotton output

Agriculture and industrial policy reforms are needed to further correct imbalance

Pakistan’s cotton farmers have managed to push past the eight million bale mark for the first time in three years, while also showing that farming is recovering well from the impact of 2022’s devastating floods. Output last year had come crashing down to just five million bales for the calendar year, as the floods washed away several crops, including cotton. However, despite the relative increase in output, we are still well off the figures from 2019-2020, when output was over 10 million bales, let alone the record figure of almost 15 million from 2015-16. Output is also still well behind the full-year target of almost 13 million bales.

The decreasing trend over the past decade has no single reason, although the most significant factor is not climate, which many would assume, but rather the collective decision of many farmers to shift from cotton to sugar about five years ago, which ended a long stretch where, even in bad years, cotton output was well above 10 million bales. While the crop change helped some farmers and people involved in the sugar industry, experts say it has caused much greater harm to the overall economy, because cotton is an essential input for the textile industry — one of our main export industries — and domestic supply shortages must be offset by imports. Apart from this, growth in the textile industry also encourages growth in several related industries, while there is almost no value addition or other significant benefit in other industries from increased sugar production.

Agriculture and industrial policy reforms are needed to further correct the imbalance created by this failure to look at the bigger picture. However, getting the government to do this may be its own problem, as textile industry insiders have been complaining about the lack of any support from Islamabad. While the government is setting optimistic export targets, the reality is that its policies have made our main export products harder and more expensive to produce, to the point where they are now uncompetitive in international markets.

Published in The Express Tribune, December 21^st, 2023.

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