Islamabad, the September 16, 2019: The Speaker National Assembly, Asad Qaiser, while taking notice of declining cotton production and land under cotton cultivation stressed that the revival of cotton was indispensable to Pakistan’s economic growth. In a bid to discuss the framework and incentives for revival of cotton, the Speaker conveyed a meeting with the Adviser to Prime Minister on Finance and Revenue,  Dr. Hafeez Sheikh, and Adviser on Commerce, Textile, Industries & Production and Investment, Mr. Abdul Razzak Dawood.  He stated that despite the fact that cotton offers comparative advantage to Pakistan, still during the last three decades more than 20% of land under cotton cultivation has declined and output had fallen by similar ratio. He added that agriculture sector being the major vehicle for investment in rural development and gainful employment, form the core of Pakistan’s economy and it’s turn around requires sustained endeavors on multiple fronts. . He assured added that the farmers will be provided with protection and incentives along with provision of quality seeds and other inputs to boost productivity.

The meeting held was a continuation of a series of discussions on the issue of minimum support price for cotton and cost of production of cotton. MNA Syed Fakhar Imam stressed that despite being Pakistan’s largest revenue generating crop with immense potential for comparative advantage, foreign exchange earnings and employment opportunities, cotton in Pakistan was beset by a host of enduring challenges on numerous fronts. He added that given the unabated rise in cost of production and continuous denial of a fair price in line with the international parity price has squeezed the profit margins of the cotton farmers and they have begun to cultivate crops which offer no comparative advantage to Pakistan’s economy. He highlighted that due to negligence and ineffective policy framework for agricultural uplift, Pakistan has ceded its competitive edge to regional competitors. He added that India has put in place a support mechanism for more than 26 crops while Pakistan has not been able to incentive its central crop. He regretted the fact that ineffective policies have enriched those already rich at the cost to the local farmers and national economy. He urged the Advisers on Finance and Commerce respectively to announce a Minimum Support Price for Cotton as an incentive to motivate the farmers to cultivate farmers. 

Adviser for Finance Dr Hafeez Sheihkh reiterated that cotton was central to Pakistan’s agricultural growth and added that the proposal to put in a place a mechanism for Minimum Support or Indicative Price needs to be looked at in details. Speaker National Assembly urged the participants to conclude the matter in the next meeting.

Adviser for Commerce, Textile, Industries and Production & Investment, Abdul Razzak Dawood informed the participants of the meeting that contamination and trash content in domestically produced cotton were central reasons for cotton import and lower prices. He added that unregulated seeds and pesticides companies provide substandard seeds and pestidices to cotton growers which have negatively affected the cotton productivity in Pakistan. He further added that the domestic consumption exceeds domestic supply and as a result cotton has to be imported from other countries. He further added the imposition of 10% Sales Tax on purachse of domestic raw cotton and 17% tax of yarn has further complicated the matters.

The meeting was attended by Dr. Hafeez Sheikh, Mr. Abdul Razzak Dawood, Minister for National Food Security and Research Sahibzada Muhammad Mehboob Sultan, MNA Syed Fakhar Imam and Chairman FBR Syed Shabbar Zaidi.