All Pakistan Textile Mills Association (APTMA) Chairman Tariq Saud has deplored the government’s plan to allow the Trading Corporation of Pakistan (TCP) to purchase lint from ginners, saying that it is an ‘imprudent’ approach to support the farmers.
He also criticised the Ministry of Textile Industry for suggesting an indicative price for the cotton on the pattern of wheat and intervene through the TCP by directly buying lint from ginners.
“It appears that the Ministry of Textile Industry is clueless about the dismal state of affairs in the textile industry where the cotton consumption has already been reduced to 13 million bales from 16 million bales, 35% of the capacity has totally collapsed and another 30% is incurring losses due to the high cost of doing business,” he added.
He said the industry has become unviable against regional competitors where the respective governments have extended financial support, subsidised exports and offered incentives to juggernaut Pakistan’s exports to the international marketplace.
“The import of cotton on import parity due to the shortage domestically has already added fuel to the fire,” he added.
The APTMA chairman said a more prudent way will be to support the cotton farmers through direct subsidy as was announced by the prime minister last year. Any other measure would tantamount to wastage of public funds especially when the TCP also lacks infrastructural facility to hold the cotton lint, he added.
The APTMA chairman urged the government to withdraw 4 per cent custom duty on import of cotton as the textile industry is reeling from the effects of a total crop failure in the 2015-16 season and the cultivation of cotton for the year 2016-17 is expected to decline by approximately 25 per cent which will ultimately decline the availability of cotton for the domestic industry.