Big textile crisis in the making, masses to pay price
Islamabad: A big textile crisis is in making as cotton output is set to slide by almost 3.2 million bales which may damage the textile industry beyond early repair, Pakistan Economy Watch said on Friday.
Last year cotton output was short by 3.8 million bales and Pakistan had to import 4.7 million bales. We could never manage to get a bumper crop after 2004-5 and no one ever cared to know the reasons behind the slide, said Dr. Murtaza Mughal, President, Pakistan Economy Watch. He said that officials and ministries are only interested in fixing targets of 14 plus million bales without coming close to it since years.
He said that textile is the largest employment generating and foreign exchange earning sector with 60-65 pc share in exports. But, this sector has been subjected to politics and experiments. Now masses and stakeholders will pay for the decision to export cotton to India and turning back on sliding output.
Negligence on the part of officials will push thousands of skilled and semi skilled workers into unemployment that may lead them to riots. Similarly, thousands of small time factory suppliers etc will also face the music due to closure of main units.
Subsidizing cotton imports can reduce losses of most effective sector
Dr. Murtaza Mughal said that shortage of cotton in domestic market will push imports resulting in costly end products. The price difference will put Pakistani products at disadvantage in the international market where China, Vietnam, India and Bangladesh etc are offering products at lower prices.
Vietnam and Bangladesh and some other countries are already enjoying preferential treatment in some of the major markets creating trouble for those who are not in the good books, said Dr. Murtaza Mughal. “This will result in closure of many main units and affiliated businesses,” said Dr. Murtaza Mughal adding that the situation would have been not deteriorated to this extent if the revolutionary decision to export cotton to New Delhi was not taken.
Apart from low cotton output, the price of electricity, other inputs and withdrawal of some relaxations had already hit the textile sector hard. He said that Pakistan can try to retain its position in international market by subsidizing import of cotton. Barter system should also be explored to avoid exhausting depleted forex stocks that now stands at 8.82 billion. Pakistan Economy Watch
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