Pakistan’s agriculture sector, long regarded as the backbone of the country’s economy, is facing one of its most serious challenges in decades. A new report by the Overseas Investors Chamber of Commerce and Industry (OICCI) reveals that Pakistan Cotton Production has collapsed by more than 50 percent from its historic peak, creating annual economic losses estimated between $2 billion and $3 billion through rising import costs and shrinking export earnings. The report, Seeds of Growth, warns that Pakistan’s agricultural crisis is no longer driven primarily by climate or technology. Instead, inconsistent government policies, regulatory delays, and slow implementation of reforms are preventing the sector from reaching its full potential while regional competitors continue to move ahead. Pakistan Cotton Production Falls Far Below National Targets Cotton Output Drops Sharply The most alarming finding of the report is the sharp decline in Pakistan Cotton Production. Cotton output has dropped from nearly 14 million bales at its peak to an estimated 6.85 million bales during the 2025-26 season, missing the government’s own production target of 10 million bales by approximately 34 percent. According to the report, the decline has been fueled by multiple challenges including climate change, repeated pest attacks, poor-quality seed varieties, and restrictions on certain pesticide ingredients introduced without a scientifically planned transition strategy. The consequences extend far beyond farming. Pakistan’s textile industry, which generates nearly 60 percent of the country’s export earnings, relies heavily on locally produced cotton. As domestic production falls, textile manufacturers are forced to import more cotton, increasing pressure on Pakistan’s foreign exchange reserves and widening the trade deficit. The report estimates that restoring Pakistan Cotton Production to between 8 and 9 million bales could significantly reduce import dependence while strengthening export competitiveness. Maize Sector Also Missing Growth Opportunities Cotton is not the only crop suffering from policy delays. The report highlights maize as another missed opportunity for Pakistan’s economy. Hybrid seed technology has already tripled maize yields over the past three decades. However, despite the recent approval of Pakistan’s National Biotechnology Policy by the federal cabinet, implementation has yet to begin. According to OICCI, the delay is preventing farmers from accessing advanced biotech maize hybrids capable of generating an estimated $1 billion in maize grain and silage exports. OICCI Secretary General M. Abdul Aleem welcomed the government’s approval of the biotechnology policy but emphasized that legislation alone cannot transform agriculture unless it is formally implemented. He stressed that investor confidence, export growth, and higher farm productivity will remain unrealized until execution matches policy commitments. Multiple Agricultural Sectors Face Challenges The report also exposes deep structural problems across several key agricultural industries. Pakistan’s potato sector continues to struggle because certified processing-grade seed accounts for less than five percent of total production. As a result, average yields remain between 20 and 23 tonnes per hectare, considerably below the 30 to 35 tonnes achieved by competing agricultural economies. In the dairy industry, despite Pakistan ranking among the world’s largest milk producers, only around 10 percent of milk is processed, while nearly 20 percent of production is lost because of inadequate cold-chain infrastructure and storage facilities. The tobacco industry faces rising production costs that have more than doubled during the past three years. At the same time, a significant undocumented tobacco market continues to operate outside the tax system, reducing government revenues and creating unfair competition for compliant businesses. The report also highlights an imbalance in fertilizer usage. Farmers continue to rely heavily on nitrogen-based urea while the use of potash, essential for maintaining healthy soil and balanced crop nutrition, remains extremely limited despite recent growth in demand. Policy Stability Key to Investment The report argues that Pakistan already possesses access to modern agricultural technologies through multinational companies operating in the country. OICCI member firms have introduced internationally recognized seed technologies, advanced crop protection solutions, and precision farming techniques that can substantially improve productivity. However, continued investment depends on predictable regulations, transparent approval processes, and consistent government policies. Without these conditions, investors remain cautious despite Pakistan’s enormous agricultural potential. OICCI Recommends Faster Agricultural Reforms The report concludes that Pakistan’s agricultural recovery depends on decisive and timely reforms rather than additional policy announcements. Among its key recommendations are faster approval procedures for seed varieties and pesticides, stronger enforcement against counterfeit seeds, a nationwide strategy to reduce post-harvest losses, and expanded financial access for smallholder farmers, who represent nearly 90 percent of Pakistan’s farming community. If these reforms are implemented effectively, Pakistan Cotton Production could recover substantially, reducing import dependence, strengthening exports, attracting foreign investment, and restoring confidence in one of the country’s most important economic sectors.
