The monthly report of the International Cotton Advisory Committee has pointed out a 6pc loss in cotton consumption because of persistent energy crisis in Pakistan, while persistent low cotton prices are forcing farmers to shift to other competing crops with better returns.
Coupled with this cotton crisis is the problematic rice surplus, particularly of basmati, and the agri business picture worsens for everyone — from farmers to traders to industry.
What makes the situation even more frustrating is the government’s failure to tackle the long-standing, underlying and aggravating problems of cotton growers. Instead, when the cotton rates fell much below the cost of production, the government, asked the Trading Corporation of Pakistan (TCP) to lift 1m bales off the market and help stabilise the falling prices.
The procurement is currently stuck at 390,000 bales and markets rates have not improved. The TCP has stopped receiving samples for procurement.
For the rice crisis, the government announced a compensation plan for the basmati farmers, modalities of which were to be decided later on. Its revenue department has no data about who sows basmati and who does not. Without such precise data, how would it dole out compensation — cash or kind? No one really knows; at least in Punjab, where basmati is sown. Thus, neither the nature of subsidy is decided yet nor the list of recipients has yet been finalised.
