AIRLINK 75.20 Decreased By ▼ -0.23 (-0.3%)
BOP 5.11 Increased By ▲ 0.04 (0.79%)
CNERGY 4.61 Decreased By ▼ -0.14 (-2.95%)
DFML 29.75 Decreased By ▼ -0.35 (-1.16%)
DGKC 88.10 Decreased By ▼ -2.38 (-2.63%)
FCCL 22.50 Decreased By ▼ -0.40 (-1.75%)
FFBL 33.08 Increased By ▲ 0.13 (0.39%)
FFL 10.04 Decreased By ▼ -0.01 (-0.1%)
GGL 11.13 Decreased By ▼ -0.21 (-1.85%)
HBL 114.41 Increased By ▲ 0.92 (0.81%)
HUBC 136.70 Increased By ▲ 0.19 (0.14%)
HUMNL 9.54 Decreased By ▼ -0.36 (-3.64%)
KEL 4.63 Decreased By ▼ -0.03 (-0.64%)
KOSM 4.64 Decreased By ▼ -0.05 (-1.07%)
MLCF 39.85 Decreased By ▼ -1.25 (-3.04%)
OGDC 135.11 Increased By ▲ 0.31 (0.23%)
PAEL 27.00 Decreased By ▼ -0.61 (-2.21%)
PIAA 24.40 Decreased By ▼ -1.07 (-4.2%)
PIBTL 6.95 Increased By ▲ 0.03 (0.43%)
PPL 123.95 Decreased By ▼ -0.50 (-0.4%)
PRL 27.15 Decreased By ▼ -0.25 (-0.91%)
PTC 14.15 Decreased By ▼ -0.35 (-2.41%)
SEARL 60.50 Increased By ▲ 0.30 (0.5%)
SNGP 71.00 Increased By ▲ 0.45 (0.64%)
SSGC 10.49 Decreased By ▼ -0.07 (-0.66%)
TELE 8.76 Decreased By ▼ -0.13 (-1.46%)
TPLP 11.65 Decreased By ▼ -0.13 (-1.1%)
TRG 66.81 Decreased By ▼ -0.85 (-1.26%)
UNITY 25.23 Increased By ▲ 0.06 (0.24%)
WTL 1.45 Decreased By ▼ -0.03 (-2.03%)
BR100 7,740 Increased By 15 (0.19%)
BR30 25,508 Decreased By -93 (-0.36%)
KSE100 74,040 Increased By 241.3 (0.33%)
KSE30 23,778 Increased By 154.6 (0.65%)

Responding to a report appearing in the Press recently that the government is considering to buy one million cotton bales at high prices from the market in order to support the growers, Amin Hashwani, Chairman, the Karachi Cotton Association (KCA) reiterated the Association's views that such an exercise would be counter productive.
Any intervention by the government-public sector organisation in the cotton market would create distortions with adverse repercussion for cotton exports, allied industries and the economy in general. It would also negate the declared free trade policy being followed successfully in the sector since over a decade. The Association strongly supports the growers and advocates a fair return to not only cover their cost but also a reasonable income for them.
However, by procuring large stocks of cotton at considerably high prices from the market will create unnatural shortage of quality cotton, incur billions of Rupees of losses to the exchequer, inflate prices unnecessarily, render the Textile Industry uncompetitive, accelerate the decline of exports, cause industry closures and unemployment. In addition, the desired benefit will not be passed on to the growers as most of it will be realized by the ginners and middlemen, as was the case last season. It may be recalled that last year the Government through TCP intervened in the cotton market to procure Cotton from the ginners at inflated prices but very little benefit passed on to the growers and those stocks are still lying with the Corporation which will cause heavy losses when disposed. An efficient and a more effective way to companionate the growers in adverse conditions would be to provide direct subsidy to them on the basis of the acreage sown as is practiced in other countries. The proposed mechanism would not only ensure direct benefit to the growers without any middlemen or malpractice but also help to lessen the losses to the government.-PR

Copyright Business Recorder, 2015

Comments

Comments are closed.