Pakistan has introduced some measures for improving the textile industry. These include: imposition of 10 per cent regulatory duty on the import of yarn and fabric, especially from India, provision of long term financing to the ginning and spinning sectors and a reduction in long term financing and export financing by one per cent.

Yarn rates have risen only slightly in the domestic market but the off take remains mostly low. Thus only moderate enquiries for yarns are being received by mills. There are reports that considerable quantities of seed cotton from Sindh are being sold in Punjab due to the higher rates there.

Though yarn prices have increased moderately, cotton prices have risen further this week. Cotton rates have gone up because mills desire to produce a higher quality of yarns and textile products for the export market.

In Karachi nearly 1.4 million bales during the current season have been booked for imports till now and may total about 2.5 million bales during the current season. Quality damage has also been reported in the current domestic crop leading mills to go for imported cottons.

Domestic mills have also reportedly covered more cotton recently due to problems of lower quality of lint which may persist in the local cotton for the remainder of the season.