Pak likely to announce Rs10b research fund to enhance cotton output

The Pakistan government to enhance cotton production next season is likely to announce a Rs10 billion research development fund, as the harvest remained unimpressive for the past few years. This was disclosed that a high level meeting on Wednesday. In the huddle, the idea of creating the research development fund was floated which was welcomed by Punjab and Sindh.

Representatives of major cotton-producing provinces – Punjab and Sindh – attended the meeting held at the Planning Commission. Other stakeholders were also present.

The government official said that it was a 10-year plan, which would be sent to the federal cabinet for approval. It is likely to be formally announced in next fiscal year’s budget in May this year.

Under the plan, the government will spend Rs1 billion every year on research activities to find out ways of increasing the production of cotton, which feeds the massive textile industry of Pakistan.

The plan came after spinning mills went to court challenging the cotton cess amounting to Rs400 million that they had been paying every year for spending on research work.

However, for the past two years, they had refused to contribute and went into litigation with the federal government.

According to the government official, it was decided in the meeting that the research fund would be disbursed in the form of competition grant to the researchers.

Absence of a support price has also pushed cotton farmers towards planting other crops such as wheat and sugarcane for which the government has been announcing support prices to ensure a fair return to the growers.

In recent years, the cotton plantation area has shrunk in the wake of setting up of sugar mills in the cotton zone of south Punjab.
Cotton farmers have not been able to notch up satisfactory earnings and have switched to sugarcane cultivation in areas where sugar mills have been set up.

Country’s economic managers had decided last year to frame a national sugar policy in a bid to secure the cotton belt that had come under threat from the growing number of sugar mills and planting of sugarcane in such zones.

Almost 70% of sugar mills are located in the core cotton zone of the country, especially in Punjab. The presence of mills in top cotton-growing areas and their increasing crushing capacity have caused a 26% decline in cotton-sowing areas, especially in south Punjab including Rahim Yar Khan and Muzaffargarh.

The Ministry of Textile Industry has also demanded that provinces should stop granting permission for establishing new sugar mills in the cotton-growing areas.

Cotton production has been estimated at 11.1 million bales in the ongoing season against the target of 12.6 million bales. The harvest was even lower at 10.7 million bales last year.