Pakistan’s textile industry recovers significantly amid surge in cotton and man-made yarn imports

According to Pakistan’s “Express Forum” report on December 9, InsightSecurities released a report showing that Pakistan’s textile industry is recovering significantly in 2020, supported by a surge in imports of cotton and man-made yarn. Exports increased by approximately 16% and 9% month-on-month in September and October this year. At the same time, the government has also adopted a series of stimulus policies to promote the growth of textile industry exports, abolished the 5% import regulatory tariff on cotton, provided energy subsidies to related industrial enterprises, and announced the provision of long-term financing loans. However, data from the Pakistan Bureau of Statistics (PBS) shows that as an agriculture-based country, Pakistan imported US$290 million in cotton from July to October this year, compared with only US$47 million in the same period last year. The government must take measures to increase domestic cotton production. Continued imports will not only hurt the confidence of cotton growers, but will also impact upstream and downstream enterprises in the textile industry from imports, causing costs to soar further. If this trend continues, the textile industry may continue to rely on imported cotton, ultimately hurting the entire industry.