Pakistan's cotton sector under pressure as taxes and policy failures push farmers toward alternative crops

Lahore [Pakistan], March 6 (ANI): As the cotton sowing season approaches in South Punjab and Sindh, farmers are preparing for the upcoming Kharif cycle amid mounting economic pressures. Growers say they are entering the season not only with seeds but also with a heavy tax burden that could influence their decision to plant cotton this year. Farmers believe these financial pressures could further accelerate the decline of cotton cultivation in Pakistan, as reported by The Express Tribune.
According to The Express Tribune, in addition to taxation, cultivators are grappling with soaring input costs, which they say have become an unavoidable reality in recent years. Even after completing the crop cycle, farmers often face uncertainty in the market where middlemen dominate the supply chain, leaving growers unsure whether they will receive fair prices for their produce.
Farming groups have repeatedly urged federal and provincial authorities to introduce immediate reforms to revive the cotton sector. Among the major demands raised by agricultural organisations is the removal of the 18 per cent General Sales Tax (GST) on locally produced cottonseed and oilcakes. Farmer representatives argue that the tax significantly increases production costs at a time when growers are already struggling to remain profitable.
Speaking on the issue, Pakistan Business Forum (PBF) Punjab President Malik Talat Suhail urged the Ministry of Finance and the Federal Board of Revenue to issue a Statutory Regulatory Order eliminating the GST, a step he believes would encourage farmers to expand cotton cultivation.
The call for relief comes as the Punjab government has set a target of cultivating cotton on 0.7 million acres during the early sowing phase. The provincial administration has also announced a PKR 2 billion project aimed at transforming the Bahawalpur Division into a cotton valley. However, the sector is still recovering from last year's disappointing performance.
The Federal Committee on Agriculture had fixed a national production target of 10.18 million bales for the 2025-26 season, yet actual production reached only 6.85 million bales, falling 34 per cent short of expectations. Farmers say the situation is pushing many to reconsider cotton farming altogether.
Muhammad Aslam, a cotton grower from South Punjab cultivating around 20 acres, said many farmers suffered financial losses last season due to floods and rising costs. He stated that without timely government support, several farmers may shift to crops such as sugarcane or leave their land unused, as cited by The Express Tribune.
Experts also point to deeper structural problems behind the decline of cotton. Weak pest monitoring systems, poor seed quality, limited mechanisation, and policy decisions favouring sugarcane cultivation have collectively contributed to shrinking cotton acreage.
In Punjab alone, land under alternative crops like sugarcane, rice, maize, and sesame has expanded by 22 per cent while cotton cultivation continues to shrink, as reported by The Express Tribune. (ANI)