Regulatory duty on cotton imports from India on the cards

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After being told that All Pakistan Textile Mills Association (APTMA) was pressurising to allow duty free import of one million cotton bales from India through the Wagah border which could jeopardise the local cotton crop, the Senate Standing Committee on National Food Security and Research unanimously recommended immediate imposition of regulatory duty on cotton imports through the land route.

The meeting of the committee was chaired by Syed Muzaffar Hussain Shah. The committee was informed by Cotton Commissioner Khalid Abdullah that the decline in last year’s cotton crop resulted due to low commodity prices. The crisis resulted from APTMA’s import of over 500,000 bales from India through the Wagah border.

He said that overall, the country’s cotton acreage has declined by 12.7 per cent but in Punjab the acreage was 14 per cent short of the target. He disclosed that the APTMA imports through land routes caused a loss of Rs 22 billion to the Pakistani farmers last year.

When asked how the Indian cotton was cheaper than the Pakistani cotton, Senator Mohsin Leghari said the Indian government is providing Rs 612 billion per annum subsidy on fertiliser to its growers; provide free electricity for tube wells and that freight subsidy is also available for exports.

Minister for National Food Security Sikandar Hayat Bosan said that the APTMA has managed to shift the subject of cotton to the Ministry of Textile, which is not capable of handling the issues of agriculture and growers. He said the APTMA was importing cotton from India claiming that it was extra-long staple. However that kind of cotton is not grown by India and only the US and African countries grow that kind of cotton.

Bosan said that 364,000 bales of fine cotton were available with the Trading Corporation of Pakistan (TCP) and ginners and the APTMA was reluctant to buy from them. Senator Saud Aziz said that if the cotton stocks with local mills were included they would have close to a million bales in the country. He said there is no justification to allow imports from India as it will jeopardise the Pakistani farmers.

The committee recommended banning cotton imports from India. However, Senator Saud Aziz said that it was not possible under the WTO rules but that it could be restricted through regulatory duty. The committee unanimously recommended imposing regulatory duty on import of cotton through the land route.

Chairman Syed Muzaffar Hussain Shah expressed serious concern over the stance of the Capital Development Authority (CDA) administration over the National Agricultural Research Centre (NARC) farms. He asked the Pakistan Agricultural Research Council (PARC) chairman and other scientists to restart their protest campaign as the CDA is going back on its earlier stance.

The committee was informed that the CDA’s counsel had assured the Supreme Court that they would withdraw their summary of ending the lease of NARC agriculture research farms. The CDA director, however, told the committee that the legal counsel had given assurance on his own to the court. The CDA board has decided that the matter can be resolved only by the government.

The standing committee’s chairman said that under the parliamentary rules, the recommendations of committees are binding on the public institutions if they don’t raise any objections over the recommendations. He said that the committee had recommended on November 16, 2015 not to withdraw lease of NARC farms, adding that if after seven months they tried to revoke it, then action would be taken against the CDA administration.