Pakistan’s cotton sector is facing a deepening crisis, marked by declining self-sufficiency, increasing import dependence, and escalating risks from climate change and administrative weaknesses. A new report by EMPAK Strategies highlights the precarious state of the industry, warning that without comprehensive reforms, Pakistan’s cotton production could weaken further, with serious implications for the national economy and its crucial textile exports.
The report, released on , reveals that Pakistan now relies on importing between $2 billion and $3 billion worth of cotton annually, a significant shift from its historical position as a largely self-sufficient producer. This import dependence is placing considerable strain on the country’s foreign exchange reserves and driving up input costs for the textile sector, Pakistan’s largest export industry.
While cotton production experienced a modest rebound in the season, reaching an estimated 5 million bales, this recovery is considered fragile and insufficient to restore Pakistan to its former status. Production had plummeted from approximately 7 million bales in to 3.9 million bales in , a decline attributed to a combination of environmental shocks, policy gaps, and shifting cropping patterns.
The early arrival of the sowing season, triggered by an unexpected temperature rise, is offering a limited window of opportunity. Temperatures in Sindh’s coastal cities, including Thatta, Badin, and Tando Muhammad Khan, have already reached 35°C, prompting farmers to begin cotton sowing earlier than usual. Sowing is expected to commence in other parts of Sindh and in key cotton-growing districts of Punjab, such as Bahawalnagar, Bahawalpur, Vehari, and Sahiwal, within the next eight to ten days.
The Punjab Agriculture Department has set a target of cultivating early cotton on 700,000 acres this season, focusing on the Multan, Dera Ghazi Khan, Sahiwal, and Faisalabad divisions. However, the exclusion of Bahawalpur division – historically a leading region for early cotton cultivation – from this initiative has raised concerns among stakeholders.
Adding to the challenges, the report identifies climate change as a key risk factor. Rising temperatures, erratic rainfall, water scarcity, and increasing pest resistance are all contributing to reduced yields per hectare. Projections indicate that temperatures in cotton-growing regions could rise by 1.5 to 2°C by , potentially exacerbating production losses.
Beyond climate-related pressures, the EMPAK Strategies report points to significant administrative weaknesses. These include poor pest surveillance, limited crop insurance, insufficient traceability systems, and a lack of coordination between federal and provincial authorities. The absence of a single accountable entity responsible for national cotton outcomes results in limited data integration, weak risk-sharing frameworks, and inadequate export compliance systems.
The report also highlights a concerning trend: the expansion of sugarcane cultivation at the expense of cotton. Several sugar mills are reportedly incentivizing farmers to switch crops by offering fertilizers, agricultural chemicals, machinery, and even cash payments. Ihsanul Haq, Chairman of the Cotton Ginners Forum, warned that this development could further reduce the area available for cotton farming.
“The federal and provincial governments need to sympathetically consider the demands of the textile and cotton industries to help reverse declining exports and strengthen the country’s trade performance,” Haq stated.
To address these challenges, EMPAK Strategies proposes a transition from the current fragmented, subsidy-driven farming model to an integrated “Cotton-as-a-Service” (CaaS) model. This approach would be based on cluster production, performance-linked service delivery, digital traceability, and yield-linked finance. The report suggests that Development Finance Institutions and risk-sharing instruments, such as first-loss guarantees, could play a crucial role in improving productivity, strengthening climate resilience, enhancing export compliance, and attracting private investment.
The report emphasizes that without integrated governance structures that align environmental management, institutional accountability, and financial innovation, any productivity recovery will likely be temporary. The future of Pakistan’s cotton sector, and the broader textile industry it supports, hinges on the implementation of comprehensive and coordinated reforms.
