Market uncertainties, miniscule share to stall growth

However, the industry also faces certain challenges in the coming year. It is likely to be particularly troubled by the uncertainties in the cotton as well as currency markets. Also, the industry' s miniscule share of 1.7 percent in the global textile market may prove to be a cause of concern.

Another challenge the industry faces is the rise in cotton yarn prices. Globally, cotton prices have reached $1 per pound, sparking a debate over the need for a regulatory duty to be imposed on yarn exports. However, such regulatory duties can have adverse effects on the domestic market and hence, the government needs to abstain from such quotas.

The government needs to refrain from buying cotton at import substation from the local market and selling it at 10 percent below export parity price. It should also not subsidize the downstream industry as this puts farmers at a great disadvantage. A conducive environment has led to a 50 percent rise in cotton production in Pakistan this year. This is expected to surge the crop' s value to Rs 600 billion, thus giving farmers an additional benefit of Rs. 400 billion.