Cotton value chain: from crisis to a national mission

Pakistan’s cotton crisis is no longer merely a story of declining crop production. It reflects the gradual weakening of the country’s entire cotton value chain, encompassing institutional capacity, economic viability, technological advancement and policy coherence.

There was a time when Pakistan ranked among the world’s leading cotton-producing countries. The domestic textile industry relied predominantly on locally produced cotton, and cotton served as one of the pillars of the country’s agricultural exports. Today, the situation has been fundamentally reversed. According to the USDA, Pakistan’s cotton production declined to approximately 5.2 million bales in 2025, compared with nearly 14 million bales in 2014-15. The cultivated area has stagnated at around 2 million hectares, while dependence on imported cotton has increased sharply.

In 2025 alone, Pakistan imported cotton worth more than US$2.5 billion, primarily from Brazil, the United States and other producing countries. This represents a substantial drain on foreign exchange, while farmers, the ginning industry, research institutions and the textile sector continue to face deep structural challenges.

A review of the past decade clearly illustrates that Punjab, once the country’s principal cotton-producing region, has experienced a pronounced decline, whereas Sindh has maintained relatively greater stability. Had climate change been the sole determining factor, both provinces would have exhibited broadly similar production trends. The evidence suggests otherwise. Climate-related stresses, including heatwaves, erratic rainfall and water scarcity, are undoubtedly real. However, economic, administrative, marketing, research and regulatory factors have also played decisive roles. While countries such as Brazil have achieved record cotton production in recent years, and China and India have strengthened their positions through higher productivity and technological advancement, Pakistan’s average yield has remained around 500–600 kilograms per hectare, significantly below the global average.

The farmer remains the foundation of the entire value chain, yet has borne the greatest burden of uncertainty. Production costs have risen dramatically, while cotton growers continue to operate without a reliable marketing mechanism capable of providing confidence regarding future prices. Unlike sugarcane and wheat, cotton has not benefited from consistent policy support. The absence of a support price, extreme market volatility, escalating input costs, uncertain irrigation supplies, increasing pest pressure, widespread cultivation of non-approved seed varieties and rising financial risks have collectively encouraged farmers to shift towards relatively more secure and profitable crops.

The seed sector itself requires fundamental reform. Although efforts have been made to strengthen the regulatory framework, the continued large-scale cultivation of non-approved varieties highlights a significant gap between legislation and enforcement. Domestic breeding programmes have historically focused primarily on seed cotton yield and ginning outturn, while paying insufficient attention to the fibre characteristics demanded by the global textile industry, including staple length, fibre strength, uniformity and micronaire. Research institutions possess experienced scientists, valuable germplasm collections and decades of scientific expertise. However, persistent financial constraints, inadequate investment and weak commercialisation mechanisms continue to limit their full potential.

The ginning sector has likewise remained largely neglected. International cotton trade increasingly depends upon fibre quality, yet a substantial proportion of Pakistan’s ginning factories continue to operate with outdated technologies. Fibre contamination, inadequate moisture management and limited technological modernisation undermine Pakistan’s competitiveness in global markets. Meanwhile, the textile and spinning industries face mounting pressure from high energy costs, heavy taxation, rising financing costs and inadequate domestic availability of quality raw material. Consequently, Pakistan imports millions of bales of cotton every year, creating the paradox of one of the world’s largest textile-producing nations becoming increasingly dependent on foreign markets for its most fundamental raw material.

The international landscape provides an instructive comparison. Brazil, the United States and Australia have successfully enhanced both productivity and fibre quality through modern genetics, mechanization and sophisticated marketing systems. At the same time, major importing markets, particularly the European Union, are placing increasing emphasis on traceability, sustainability and environmental compliance. Unless Pakistan aligns its cotton sector with these evolving international standards, its export competitiveness is likely to deteriorate further.

The most significant weakness underlying this crisis is not the absence of institutions, but rather the absence of an integrated national command and coordination system capable of managing the entire cotton value chain under a unified strategy. Farmers, seed developers, research organizations, regulatory authorities, ginners, textile manufacturers, traders and exporters all perform their respective functions. However, no institution exists to unite them under a common national vision, shared objectives and a single performance accountability framework.

Following the 18th Constitutional Amendment, agriculture became a provincial subject. Accordingly, no national institution can succeed without the full participation, joint ownership and collaborative decision-making of Punjab and Sindh. Any future institutional framework must therefore be built upon a genuine federal-provincial partnership, involving provincial agriculture departments, research institutions and the private sector as equal stakeholders. Should the ongoing institutional reforms result in the merger of the Pakistan Central Cotton Committee (PCCC) with the Pakistan Agricultural Research Council (PARC) and the establishment of a strengthened national Cotton Wing, it should not be viewed merely as another research department. Rather, it should become the nucleus of a comprehensive national institutional framework.

Pakistan now requires the establishment of a National Cotton Value Chain Authority, alternatively structured as a National Cotton Mission, operating in mission mode to manage the entire cotton value chain through a unified policy framework, integrated national database and common performance management system. The Authority should comprise at least eight strategic directorates.

1. Cotton Production and Farmer Support Directorate to oversee cotton acreage, production economics, farm profitability, irrigation management, climate resilience, agricultural advisory services, digital extension and the long-term economic sustainability of cotton farmers.

2. Seed Research, Biotechnology and Genetic Resources Directorate to lead breeding programmes, hybrid seed development, genomics, gene editing, germplasm conservation, breeder seed production and the development of climate-resilient cotton varieties.

3. Seed Regulation and Quality Assurance Directorate to manage seed registration, certification, market surveillance, DNA-based variety identification, traceability systems, counterfeit seed prevention and effective regulatory enforcement.

4. Cotton Quality, Ginning and Standards Directorate to improve fibre quality, modernize ginning technology, reduce contamination, strengthen moisture management, expand HVI-based testing and align national grading standards with international benchmarks.

5. Textile Linkages and Value Addition Directorate to strengthen technical collaboration between research institutions, the ginning industry and textile manufacturers, ensuring that new cotton varieties deliver not only higher yields but also the fibre characteristics demanded by modern spinning mills.

6. Market Intelligence, Trade and Export Directorate to provide continuous analysis of domestic and international markets, price trends, imports, exports, import substitution opportunities, value addition and Pakistan’s global competitiveness.

7. Innovation, Investment and Public-Private Partnership Directorate to facilitate private investment, local and international joint ventures, agricultural start-ups, SMEs, technology commercialization and the effective transfer of research outcomes to industry.

8. Policy, Data Analytics and Performance Management Directorate to establish a comprehensive national cotton data platform, develop measurable performance indicators, evaluate institutional performance annually and ensure that policymaking remains firmly grounded in evidence-based data.

Unless all of these strategic functions operate under a single national command and coordination framework, individual institutions will continue working in isolation without producing meaningful improvements across the cotton value chain. Pakistan no longer requires fragmented administrative structures; it requires a coordinated national mission.

A phased implementation roadmap should accompany these institutional reforms.

Phase I (Year One): Establish the institutional framework, conclude a federal-provincial partnership agreement, develop the national cotton data platform, strictly enforce seed regulations and launch farmer support programmes in selected pilot districts.

Phase II (Years Two to Three): Invest heavily in modern breeding and biotechnology, introduce incentives for technological modernization within the ginning sector, establish structured partnerships with the textile industry and target a 20–25 percent reduction in cotton imports.

Phase III (Years Four to Five): Scale reforms nationwide, significantly improve per-hectare productivity, substantially reduce import dependence and fully align Pakistan’s cotton sector with international standards for traceability and sustainability.

Each phase should include clearly defined Key Performance Indicators (KPIs), annual performance evaluations and meaningful private-sector participation.

Pakistan possesses fertile agricultural land, diverse agro-climatic zones, experienced scientists, a globally recognized textile industry and a large domestic market. The missing element is not capacity but coordination. These assets must be integrated into a coherent national system rather than allowed to function as isolated institutions. The revival of Pakistan’s cotton sector is not merely the responsibility of one ministry or one province: it is a national economic imperative. If Pakistan genuinely seeks to strengthen its textile industry, reduce dependence on imported cotton and expand agricultural exports, it must begin by fundamentally restructuring its cotton value chain through provincial cooperation, evidence-based policymaking, international competitiveness and a clearly defined implementation roadmap. Such reform alone can restore confidence to farmers, provide direction to research institutions and create a shared pathway towards sustainable industrial growth and export competitiveness.