ALSO READIndian cotton exports to Pakistan slump amid tensions - traders Pak stops import of cotton from India amid tension Mumbai attack case: Pakistan commission to inspect boat used by terrorists Pakistan demolished over 100 offices of MQM party in Karachi Pak stops import of Indian agricultural products
By Syed Raza Hassan and Rajendra Jadhav
KARACHI/MUMBAI (Reuters) - Pakistan has suspended cotton imports from its top supplier, India, saying shipments failed to fulfil phyto-sanitary certification, threatening the $822 million-a-year trade, government and industry officials told Reuters.
Traders say rising hostility between the neighbours might have prompted Pakistan to restrict imports. The decision will help other cotton suppliers such as Brazil and the United States to increase exports to Pakistan.
"We had received some complaints regarding insects, pests, in cotton consignments imported from India, so we have sent samples for tests," Imran Shami, director general of Pakistan's Plant Protection Department (DPP), told Reuters on Wednesday.
"If results show non-compliance of phyto-sanitary requirements, we would have to stop the imports from India."
Indian exporters have signed contracts to export 350,000 bales to Pakistan since the start of the marketing year on Oct.1 and out of that nearly 300,000 bales for shipments in December and January could get stuck, three exporters said.
Supplies from the new season crop usually start rising from November in India. But this year, supplies are negligible after a government move to ban high-value currency notes prompted farmers to postpone sales.
"Buyers and sellers are not cancelling contracts. They are waiting for some positive response from the government," said Chirag Patel, chief executive officer of Indian exporter Jaydeep Cotton Fibers.
The nuclear-armed rivals have seen tension increase in the past few months over the disputed region of Kashmir.
"It will be big problem for us if Pakistan stops buying. Other countries could not absorb the entire surplus," said an exporter based in the western state of Gujarat.
But importers say buying the fibre from other suppliers like the United States, Brazil and West Africa will prove costlier and time consuming.
"From India, imports come across within 10 days and sometimes within a week consignments used to cross the Wagha border," said ul Haq, referring to the main border crossing near the Pakistani city of Lahore.
(Reporting by Rajendra Jadhav; Editingh by Robert Birsel)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)