Bloomberg: Cotton Crisis In Pakistan Destroys Job Opportunities

“Years of bad weather, pest outbreaks, and better margins on other crops have hurt the quality and quantity of Pakistan’s cotton harvest,” Bloomberg reported.

Cotton prices in Pakistan pushed to an 11 year highA low cotton yield in the past three years has forced more than 60% of ginners to close their factories.

This has left hundreds of thousands of farmers and textile artisans out of work.

Dr. Jassu Mal, the Chairperson of the Pakistan Cotton Ginners’ Association, reported this to Bloomberg on Wednesday.

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Pakistan, one of the world’s highest cotton producers, is finding it harder to meet its own needs, a problem that could drive up import bills and further hurt its weak economy.

“Years of bad weather, pest outbreaks, and better margins on other crops have hurt the quality and quantity of Pakistan’s cotton harvest,” Bloomberg reported.

“Production in the current fiscal year is set to descend to the lowest level in about three decades.”

As a result, the country is using billions of dollars to import record amounts of cotton to maintain its textile industry.Its current account has recently flipped back into a deficit amid higher imports.

The move also endangers boosting cotton prices, which have already hit a seven-year high.

Cotton is one of the most vital cash crops for Pakistan and is commonly referred to as “white gold” by the 1.5 million farmers that depend on it for a living.

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It serves as the raw material for the textile industry, which provides employment to 40% of the workforce and produces more than half of the earnings in foreign exchange.

“The cotton crop has shrunk to a distressing level, but we don’t see the government taking any grave steps to revive production,” Mal told Bloomberg. 

In the latest season, Mal had to close at least three of his seven factories and run others at 50% capacity due to the lack of cotton.

The company’s number of ginning workers has dived to 100 from 400 about five years ago.

An employee operates a cotton ginning machine at a Waqar Cotton... News Photo - Getty Images

Nasim Usman, the Chairperson of the Karachi Cotton Brokers Forum, informed Bloomberg that Pakistan’s cotton production is forecast to plummet to less than 6 million bales in 2020-21, the lowest since at least 1992.

At its peak, output was more than 14 million bales in 2004-05. The government has set a target for 10.5 million bales for fiscal 2022.

According to Khaqan Najeeb, a former adviser to the finance ministry, the country pays dearly for overseas cotton and needs to ship 3 million to 4 million more bales by June.

Higher purchases could notably increase global cotton prices and widen Pakistan’s trade deficit, which rose more than 120% to $3.3 billion in March as the government grapples with taming inflation.

A weaker rupee increases prices of essentials at home when the country’s balance of payment position worsens.

What are your views on this? Share with us in the comments below.

  • Nomore man o salwa. Simply you reap what you sow. We have only sowed ignorance, extremism.

    Armstrong chand per gaya to azaan sun li se le ker dajjal aa gya hai. All the educated progressive ones have left the country so here you go enjoy remaining obsessed illiterates

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