KARACHI, March 5: Indian cotton exporters are reluctant to fulfil their commitments with Pakistani buyers because of increasing trend in international cotton market.
Almost half of the 2.4m bales of cotton imported by Pakistan to overcome its domestic shortage were procured from India.
According to the provisional data of the Federal Bureau of Statistics, Pakistan has made highest-ever import of cotton between August 2007 and January 2008. The total value of imports from the US, India and Central Asia was worth Rs30 billion.
About 1.1 million bales worth Rs15 billion were imported from India and the import of another 0.5 million bales was currently in the pipeline. However, after a sudden and unpredictable increase in cotton prices in the international market, now Indian exporters are reluctant to fulfil their commitments.
FPCCI CONCERNED: Expressing concern over this blockade, FPCCI President Tanvir A. Sheikh stated, in a statement on Wednesday, that such tactics would not only damage the creditability of Indian businessmen, it would also create obstacles in the politico-economic relations of the neighbouring countries.
Pakistan produced nearly 11 million bales and its annual demand stands at around 15-16 million bales.
India’s current season’s cotton production is around 27 million bales while consumption is 23.5 million bales, leaving a surplus of 3.5 million bales. But India exported 4.5 million bales.
Earlier, Indian cotton used to be imported via ship and railway, and it would be first time that would be transported through trucks.
At present, 55 trucks, carrying perishables, are coming everyday from India, but none of trucks was carrying cotton bales.
The increase in cotton prices in India and a significant surge in its freight charges together were not allowing Indian traders to fulfil their export orders to Pakistan in time.
Tanvir A. Sheikh stated that the delay in Indian cotton exports might cause production and export problems for Pakistani textile units, as textile exporting units have committed for export orders on the basis of cotton import prices and volume from India. The other reason behind delay in fulfilling orders is said to be the heavy shipment to China from India.
He urged the governments and the ministries of both the countries to intervene. —PPI
