KARACHI: The All-Pakistan Textile Mills Association cautioned on Wednesday that the government could incur a loss of Rs10 billion if the Trading Corporation of Pakistan (TCP) procures one million bales from ginners.
Aptma chairman Mohsin Aziz said in Karachi on Wednesday that unsold stocks of around two million bales presently lying with ginners are affected by flood water and if the government allows TCP to procure the same, it would result in loss to the national exchequer.
Mohsin Aziz attributed bigger holding of two million bales with ginners this year as compared to 1.2 million bales last year to gas and power shortages in the Punjab that curbed demand of the industry.
He said that when the government abstained from intervening in the period of cotton shortage last year, it should not have interfered in this matter this year when the supply situation has reversed.
He said in case government allows the TCP to lift one million bales as being demanded, it would create another scam because price of flood affected cotton held by ginners is not more than Rs3000 per bale against current market price of around Rs3600 per bale.
According to official figures, he said up to Dec 15, around 11.1 million bales reached ginneries and little less than last year the spinners have lifted cotton so far because of gas and power shortages in the Punjab where industry on average is shut for four days a week.
Meanwhile, Mohsin Aziz said the cotton assessment committee had placed total production of cotton this season at 12.2 million bales which indicates that if industry is run at full capacity, there would be shortage of cotton for domestic consumption.He felt that the decision of TCP’s intervention would not benefit growers as 90 per cent of the crop had already reached ginners.
Mohsin Aziz also rejected the notion that there was only one buyer (spinners) in the market and said that private sector exporters were also active and have booked cotton for export up to 450,000 bales for far.