Government considering import of cotton from Uzbekistan

April 12, 2021

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The government’s advisor on Trade and Industries Razzak Dawood has said that the government is considering importing cotton from Uzbekistan via land routes after it withdrew its decision to import cotton from India, as textile exporters want the government to take decisive measures amid a 40 per cent drop in the Cotton Production.

Razzak assured to value-added textile exporters during a meeting earlier this week that he would considerduty-free imports for textile exporters via land, or imposing a ban on yarn exports, or customs duties on Yarn exports. This was reported by the Pakistani garment forum.

The trade advisor was informed of the efficiecncy of cotton imports from India, which takes four days, and from Uzbekistan, which takes eight days to reach Pakistan, compared to the months of shipment.

The exporters said land imports are profitable and significant given the 40 per cent drop in cotton production in the country this year. The exporters said the import of yarn, as well as medicines imported from India, must be reconsidered.

India’s cotton imports have been linked with parliamentary approval as textile companies seek to take drastic measures to avoid price hikes amid a 40 per cent drop in cotton production. Last week, the government withdrew its decision to allow the import of cotton from India.

Cotton Yarn prices in Pakistan have increased significantly, reflecting the accumulation of cotton yarn. Value-added textile exporters are facing financial difficulties as their production costs get out of control due to the depreciation of the dollar, the rise in the price of cotton yarn by more than 40 per cent and a 700 per cent increase in freight cost.

Analysts believe that the government should make it easier for exporters to import cotton yarn from the Central Asian republics via the land route through Afghanistan, as the sea route is getting longer due to a shortage of containers and ships.

There is no doubt that the availability of cotton yarn imported from the Central Asian republics via the land route through Afghanistan will have a positive effect on textile export.

Value-added textile exporters have also turned to a consultant for advice on how to manage their industry and meet export demands in light of the current conditions and the cotton spinning crisis that is getting worse every day.

The textile sector has also asked the Trade advisor to speed up the tax exemption from the deduction as soon as possible to support the export textile industry, and they demanded that the gas fees be the same for new factories.