Karachi [Pakistan], July 23 (ANI): Pakistan is losing an estimated USD 2-3 billion annually due to declining cotton production, with regulatory delays and inconsistent policies continuing to hamper the agriculture sector, according to a report by the Overseas Investors Chamber of Commerce and Industry (OICCI), Dawn reported.

The report, titled Seeds of Growth, said Pakistan's agricultural sector contributes nearly 23 per cent to the country's GDP and employs around 37 per cent of the workforce. However, despite the availability of technology and investment opportunities, policy bottlenecks and weak implementation have prevented the sector from matching the performance of regional competitors, Dawn reported.

According to the report, cotton production has fallen sharply from a peak of nearly 14 million bales to an estimated 6.85 million bales in FY26, around 34 per cent below the government's target of 10 million bales.

The decline has been attributed to climate-related challenges, pest attacks, poor-quality seeds and restrictions on certain pesticide ingredients introduced without a science-based transition strategy.

The report noted that Pakistan's textile industry, which generates nearly 60 per cent of the country's export earnings, depends heavily on domestic cotton.

Raising cotton output to between 8 and 9 million bales could significantly reduce pressure on foreign exchange reserves, Dawn reported.

The OICCI also highlighted missed opportunities in the maize sector. Although hybrid seeds have substantially improved yields over the past three decades, the recently approved National Biotechnology Policy has yet to be implemented.

According to the report, delaying the rollout of biotech maize hybrids could prevent Pakistan from realising nearly USD 1 billion in potential maize grain and silage exports.

The report further pointed to challenges across other agricultural sectors. Certified processing-grade potato seed accounts for less than five per cent of production, while dairy processing remains limited, with only 10 per cent of milk processed and nearly one-fifth lost because of inadequate cold-chain infrastructure.

It also flagged rising tobacco production costs and an expanding untaxed tobacco sector, while stressing the need for balanced fertiliser use beyond nitrogen-based urea, Dawn reported. (ANI)