LONDON: Climate change impacts, from hotter temperatures to more droughts and floods, threaten much of the world’s cotton production, risking worsening shortages, higher prices and financial woes for growers, researchers warned on Wednesday.
Protecting the $12-billion market — in countries such as India, the United States, Brazil and China — will require both slashing emissions to limit planetary heating and stepped-up efforts by farmers to adapt to the new risks, they said.
By 2040, 40 percent of cotton-producing regions are likely to see their growing seasons shortened by rising heat, while drought could hit half of the global crop, according to a report produced by Cotton 2040, an initiative working for a more sustainable and climate-resilient cotton industry.
Eventually, if efforts to cut emissions fail and warming ramps up in line with the harshest scientific projections, cotton could be dramatically reduced as a crop, leaving the industry “a shadow of what it is today,” said Sally Uren, chief executive of Forum for the Future, an international nonprofit that backs Cotton 2040.
But even with less warming, crop losses are likely to occur even as global cotton demand rises due to population increases and an expanding middle class in some developing nations.
While growers are rapidly becoming aware of rising climate risks, few companies that rely on cotton for their products know much about those threats, and consumers even less, Uren said.
The new analysis should serve as “a wake-up call for the cotton industry,” she added.
Extreme weather has already led to growing volatility in cotton prices. Large-scale floods in Pakistan in 2010, for example, caused global cotton prices to spike to nearly $2.50 from about $0.70 in 2009, the report noted.
Crop losses are proving particularly tough for millions of developing-world cotton farmers who make up about 90 percent of the world’s growers, the report said.
Crop failures could slash incomes among poorer growers who cannot afford to adapt to changing conditions or switch to climate-smarter crops, Uren told the Thomson Reuters Foundation.
In India, where farmers are already struggling with severe droughts and water shortages, some cotton growers left with no money to restart production after their crops fail are committing suicide, she said.
Cotton-growing areas facing some of the biggest extreme weather risks include northern Sudan, Senegal and southern Mali in Africa, as well as parts of Iraq, Iran, Afghanistan and Pakistan, the report noted.
Efforts to adapt to changing conditions by shifting planting times, boosting irrigation and providing farmers with climate forecasts could help some cope better, the report noted.
But unless emissions are slashed, some cotton-growing areas will become unsuitable for the crop in the future, Uren predicted.
In those areas, governments should ensure a “just transition” for farmers, such as by helping them adopt new crops or providing social safety nets, she said.
Cotton-growing areas including Pakistan face world’s biggest extreme weather risks
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Cotton-growing areas including Pakistan face world’s biggest extreme weather risks
- Large-scale floods in Pakistan in 2010 caused global cotton prices to spike
- Crop losses are proving tough for millions of cotton farmers who make up about 90 percent of the world’s growers
IMF warns against policy slippage amid weak recovery as it clears $1.2 billion for Pakistan
- Pakistan rebuilt reserves, cut its deficit and slowed inflation sharply over the past one year
- Fund says climate shocks, energy debt, stalled reforms threaten stability despite recent gains
ISLAMABAD: Pakistan’s economic recovery remains fragile despite a year of painful stabilization measures that helped pull the country back from the brink of default, the International Monetary Fund (IMF) warned on Thursday, after it approved a fresh $1.2 billion disbursement under its ongoing loan program.
The approval covers the second review of Pakistan’s Extended Fund Facility (EFF) and the first review of its climate-focused Resilience and Sustainability Facility (RSF), bringing total disbursements since last year to about $3.3 billion.
Pakistan entered the IMF program in September 2024 after years of weak revenues, soaring fiscal deficits, import controls, currency depletion and repeated climate shocks left the economy close to external default. A smaller stopgap arrangement earlier that year helped avert immediate default, but the current 37-month program was designed to restore macroeconomic stability through strict monetary tightening, currency adjustments, subsidy rationalization and aggressive revenue measures.
The IMF’s new review shows that Pakistan has delivered significant gains since then. Growth recovered to 3 percent last year after shrinking the year before. Inflation fell from over 23 percent to low single digits before rising again after this year’s floods. The current account posted its first surplus in 14 years, helped by stronger remittances and a sharp reduction in imports. And the government delivered a primary budget surplus of 1.3 percent of GDP, a key program requirement. Foreign exchange reserves, which had dropped dangerously low in 2023, rose from US$9.4 billion to US$14.5 billion by June.
“Pakistan’s reform implementation under the EFF arrangement has helped preserve macroeconomic stability in the face of several recent shocks,” IMF Deputy Managing Director Nigel Clarke said in a statement after the Board meeting.
But he warned that Islamabad must “maintain prudent policies” and accelerate reforms needed for private-sector-led and sustainable growth.
The Fund noted that the 2025 monsoon floods, affecting nearly seven million people, damaging housing, livestock and key crops, and displacing more than four million, have set back the recovery. The IMF now expects GDP growth in FY26 to be slightly lower and forecasts inflation to rise to 8–10 percent in the coming months as food prices adjust.
The review warns Pakistan against relaxing monetary or fiscal discipline prematurely. It urges the State Bank to keep policy “appropriately tight,” allow exchange-rate flexibility and improve communication. Islamabad must also continue raising revenues, broadening the tax base and protecting social spending, the Fund said.
Despite the progress, Pakistan’s structural weaknesses remain severe.
Power-sector circular debt stands at about $5.7 billion, and gas-sector arrears have climbed to $11.3 billion despite tariff adjustments. Reform of state-owned enterprises has slowed, including delays in privatizing loss-making electricity distributors and Pakistan International Airlines. Key governance and anti-corruption reforms have also been pushed back.
The IMF welcomed Pakistan’s expansion of its flagship Benazir Income Support Program, which raises cash transfers for low-income families and expands coverage, saying social protection is essential as climate shocks intensify. But it warned that high public debt, about 72 percent of GDP, thin external buffers and climate exposure leave the country vulnerable if reform momentum weakens.
The Fund said Pakistan’s challenge now is to convert short-term stabilization into sustained recovery after years of economic volatility, with its ability to maintain discipline, rather than the size of external financing alone, determining the durability of its gains.
