News Desk
Web Desk:Pakistan has witnessed record cotton imports, leading to a significant increase in the import of cotton yarn in the textile sector. As a result, local cotton and phutti prices are experiencing a downward trend, causing concern among cotton farmers and cotton ginners.
Chairman of the Cotton Ginners Forum, Ihsan ul Haq, explained that while cotton imports from various countries are exempt from sales tax, there is an 18% sales tax on locally produced cotton and yarn purchases. This has led local textile mills to import cotton and yarn in bulk from other countries. From July to October 2024, local textile mills imported 66,000 metric tons of cotton yarn, equivalent to approximately 450,000 bales of cotton. Additionally, import contracts for 3.5 million cotton bales have been signed, with reports indicating that 1.2 million bales have already reached Pakistan.
Ihsan ul Haq further noted that Pakistan’s cotton imports are expected to reach the highest level in history this year, with over 6 million bales of cotton and an additional 1 million bales in the form of cotton yarn. According to recent US cotton export data, Pakistan signed an agreement for the import of 146,000 bales of cotton from the United States last week, marking the highest weekly import volume in the country’s history.
Despite the record imports, Ihsan ul Haq said that local textile mills are showing little interest in purchasing cotton, even as international cotton prices rise, leading to a decrease in local cotton and phutti prices. He added that the price of cotton in Pakistan has dropped below Rs. 18,000 per maund.
The Chairman of the Cotton Ginners Forum has appealed to the government to exempt local cotton and yarn purchases from sales tax to improve prices and ensure an increase in cotton cultivation next year.
