India cancels export orders for 200,000 bales

Pakistan cotton importers are considering going for arbitration service of International Cotton Association (ICA) on cancellation of 200,000 cotton bales orders by Indian exporters. Indian exporters cancelled the orders by Pakistani importers without giving any valid reason, causing a huge financial loss to the importers, said Karachi Cotton Association (KCA) member Shakeel Ahmad.

He said at the behest of Gujrat exporters, the Indian government had imposed an export duty on the produce and also raised export price to Rs 6,200 per 100 kilogram’s in Pakistani rupee. Pakistan’s textile sector would have to bear a burden of around $900 million for import of cotton to fulfill its immediate requirements of the produce from other sources.

Indian cotton prices increased around 27% and cancellation of Pakistani orders on ground of difference in import price caused increase in domestic lint prices. Indian traders have a habit of increasing their rates in line with the fluctuation in international prices even after an agreement is signed for shipment of the consignment.

Pakistan has so far imported around one million cotton bales from India at an average import price of Rs 5,800 per 100 kilogram’s while remaining orders for 200,000 bales were cancelled.