Purchase of cotton from black-market: APTMA accuses commissioner of misleading minister

All Pakistan Textile Mills Association (APTMA) has accused Cotton Commissioner of misleading the minister with respect to purchase of cotton from black-market, demanding that the issue should be referred to the investigation agency.

A letter by APTMA's Executive Director Shahid Sattar to Minister for National Food Security and Research Khusro Bakhtiar with a copy sent to Prime Minister Advisor on Commerce, Industries and Production and Investment, states that the Cotton Commissioner has claimed that up to one million bales of cotton have not been registered as they entered through the black market.

The letter further states that spinning is not a fly by night operation and involves setting up large sophisticated plants and unless the cotton is spun it cannot be used in industry.

He said it was inconceivable that such a large quantum of cotton i.e. more than 12.5 percent evaded sales tax will end up finally as apparel in the market. This would imply a very large scale fraud and gross failure of FBR as well as other agencies.

"We request that the matter should be referred to the investigating agency and that the Cotton Commissioner may be questioned about his source of information. We believe this is untrue and government officials should desist from making such reckless statements and should be suitably reprimanded after proper investigation."

Textile sector's second issue is with the presentation of selective misleading data on pricing. The Cotton Commissioner presented data of Mian Channu (one statement) and extended it to cover the entire country, with price mentioned at last year level.

This is gross misrepresentation and wrong data from across the country which may clearly depict quite the opposite picture notably that bale and Phutti prices are higher than last year, APTMA stated in its letter.

Sattar further stated that current price of good quality cotton in Pakistan was Rs 9,000 in Rahim Yar Khan/Ghotki and other areas whereas it is Rs 7500-8000 for poor quality cotton of lower Sindh and upper Punjab. Hence price of cotton depends on quality. Cotton Commissioner has deliberately tried to mislead the Minister by using the price for lower quality Phutti as representative of all of Pakistani cotton.

APTMA's third issue is with the comparison of Cotlook index A and local prices and maintaining that the farmer has been cheated. This is far from reality as Cotlook A is well defined and is far superior cotton with higher yield, lower contamination and lower moisture content; the propaganda as prepared by the Cotton Commissioner subverts the credibility of institutions and must be censured. Export price data of Pakistani cotton over the last few years can be compared to the prevailing A index price to ascertain the discount at which Pakistani cotton sells in the international market (on average this discount is approximately 10 cents a pound).

Copyright Business Recorder, 2019