KARACHI: The local cotton market stable on Tuesday. Market sources told that trading volume was satisfactory.
Cotton Analyst Naseem Usman told that even after go-ahead given by Prime Minister Imran Khan twice, the approval of Textile Policy 2020-25 is still in the doldrums as many important economic ministers, Special Assistants to PM (SAPMs) are showing defiance by opposing the policy tooth and nail, top official sources privy to the development told The News.
“The Commerce Ministry included the Textile Policy in the agenda of ECC many times, but some ECC members are not ready to accord approval to the Textile Policy which ensures electricity tariff at 7.5 cents per unit for five years and RLNG supply at $6.5 per MMBTU. The same members played an important role in the Cabinet Committee on Energy (CCOE) for making the decision to stop the gas supply to captive power plants (CPP) meant for export industry from March 1, 2021.”
Naseem told that Commerce Ministry is likely to convene a meeting of textile sector next week to prepare a comprehensive strategy to deal with gas moratorium approved by the government on January 21, 2021.
The textile sector, which contributes 60 percent to the country’s exports, argues that if there is discrimination in gas supply it will not accept it.
“Any plan must be implemented without exception. Captive generation costs 7 cents thus electricity tariff for export-oriented sector has to be rationalized at regionally competitive 7 cents otherwise we will be deprived of export market we have gained in the last year,” said one of the big players of textile sector.
Government maintains that the Captive Power Plants (CPPs) are inefficient and operate at 45 percent efficiency on LNG which is an expensive fuel.
He further noted that if industry has to get gas, it has to take it directly for the machine and not for engine/steam and cost should be at par across the country.
Feroze Alam Lari, chairman of the Towel Manufacturers’ Association of Pakistan, has said that despite the availability of a huge quantity of value-added textile export orders with the exporters of this country, different issues from time to time pinch the balloon of growing exports of the textile sector.
The export sector is already facing a scarcity of cotton yarn in the domestic market due to reduction in the production of cotton bales and export of cotton yarn which is the basic raw material of textile. Now the proverbial last nail in the coffin of the textile exporters is the non–availability of gas in the coming days for the industry. Gas is the basic fuel for manufacturing and processing of textile goods.
Despite Covid-19 across the world, the textile exporters of this country engaged the international buyers and fetched valuable export orders from them due to the export-friendly initiatives and policies of the government.
National Business Group (NBG) chairman and president of Pakistan Businessmen and Intellectuals Forum Mian Zahid Hussain expressed concern that the suspension of natural gas to captive plants will hit production, exports, investments and jobs. The decision to shut down captive power plants will also hit revenue, tax targets and foreign exchange reserves, he said. Mian Zahid added that the decision to link factories having captive power plants to the national grid should be reconsidered as the feeble power infrastructure is unable to provide continued electricity.
He said that suspension of gas supply to industries will not improve the situation in the country but it will leave three hundred thousand workers in the textile sector which other sectors will also suffer.
The supply chain supporting the export sector will also be shattered creating more problems to the industrial sector, he said.
He noted that the decision has been taken at a time when the export industry has bagged unprecedented orders and billions have been invested in capacity building and expansion which is being wasted.
Head of Progressive Ginners Group Malik Talat Sohail expressed grave concerns over announcement of subsidy on sugarcane. In his statement he rejected the governments announcement of subsidy of Rs 5000 per acer in the national plan to increase sugar cane production under the Agricultural Emergency Program and said that cotton producing areas will strongly oppose subsidy on at least sugar can crop.
Naseem told that 600 bales of Kotri were sold at Rs 11,000 per maund, 1000 bales of Mir Pur Mathelo were sold at Rs 10,600, 1760 bales of Ghotki were sold at Rs 10,500, 200 bales of Chicha Watni were sold at Rs 11,000, 200 bales of Fort Abbas were sold at Rs 10,925, 400 bales of Rajan Pur were sold at Rs 10,900, 600 bales of Faqeer Wali, 2600 bales of Yazman Mandi were sold at Rs 10,500, 200 bales of Ahmed Pur East were sold at Rs 10,450, 400 bales of Bahwal Nagar were sold at Rs 10,300 to Rs 10,400 and 200 bales of Haroonabad were sold at Rs 10,350.
Naseem also told that rate of cotton in Sindh was in between Rs 10,000 to Rs 10,700 per maund. The rate of cotton in Punjab is in between Rs 10,200 to Rs 11,000 per maund. He also told that Phutti of Sindh was sold in between Rs 3800 to Rs 5000 per 40 kg. The rate of Phutti in Punjab is in between Rs 4000 to Rs 5500 per 40 Kg.
The rate of Banola in Sindh was in between Rs 1600 to Rs 2000 while the price of Banola in Punjab was in between Rs 1800 to Rs 2250. The rate of cotton in Balochistan is Rs 10,000 per maund.
The Spot Rate remained unchanged at Rs 10,800 per maund. The Polyester Fiber was available at Rs 193 per Kg.
Copyright Business Recorder, 2021