The dispute over Karachi’s Cotton Exchange has moved beyond a property question: it now affects price discovery, fibre-quality testing and confidence across the cotton-to-yarn value chain.
The All Pakistan Textile Mills Association has called for the immediate restoration of the Cotton Exchange Building to the Karachi Cotton Association (KCA) and its tenants, warning that prolonged disruption is weakening an institution central to Pakistan’s cotton trade. APTMA says the KCA has historically supported trade facilitation, market transparency, standardisation and coordination among brokers, exporters, financial institutions and textile-sector participants.
A dispute with operational consequences
The ownership of the historic I.I. Chundrigar Road building remains contested. In December 2025, the Federal Investigation Agency and the Evacuee Trust Property Board said they had recovered the premises as federal trust property. KCA and Karachi Metropolitan Corporation disputed that position, citing KCA’s pre-Partition purchase and a lease said to run until 2081. Dawn reported in April that the ownership matter was pending before the Sindh High Court while FIA offices were being moved into the building.
The commercial effects have already been visible. During the early closure, cotton spot rates stopped being issued; brokers warned of trading losses, while spinning mills reportedly faced difficulty securing bank working capital without an established domestic market reference. Around 320 registered cotton brokers were said to have been affected.
The laboratory issue
APTMA has also highlighted the closure of the KCA High Volume Instrument laboratory, describing it as a significant loss for cotton and textile stakeholders. The association says the laboratory ranked first globally through December 2025 in CSITC Round Trials conducted with the ICAC, Bremen Fibre Institute and USDA.
That ranking cannot be independently verified from public CSITC data: the programme states that participating laboratories receive confidential diagnostic results rather than publicly disclosed individual performance rankings. However, the broader significance is clear. HVI-based fibre testing is widely used in international cotton commerce to measure and standardise fibre-quality characteristics, supporting commercial classification and buyer-seller confidence.
Protecting trade continuity
Pakistan’s immediate priority should be to separate the legal property dispute from the continuity of essential cotton-market services. Whatever the eventual court outcome, transparent spot-rate publication, access to reliable quality testing and protection of market records are operational necessities for growers, merchants, spinners, banks and exporters.
The next signal will be whether authorities create an interim arrangement that restores these functions while the Sindh High Court determines the underlying ownership case.
