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Unavailability of cotton and LC restrictions plunge Pak ind into crisis, risking massive unemployment


The textile industry in Pakistan is facing severe challenges due to the unavailability of cotton and restrictions on opening Letters of Credit (LCs) for imports. As a result, the industry's exports have been badly impacted, leading to large-scale unemployment across the sector.

Local cotton production had remained less than 5 million bales in the current season due to last year's floods and heavy rains. Therefore, the textile industry would need to import at least one million bales of cotton to meet its requirements. However, banks were not opening LCs for importing the required quantity of cotton.

Textile mills are currently operating at less than 50% of their production capacity, and around seven million people associated with the sector have lost their jobs. If the industry remained closed under the current unfavorable conditions, more than 10 million people would be rendered jobless, and the country would lose annual export revenue of over $10 billion.


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