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Business Recorder
3 days ago
- Business
- Business Recorder
Local cotton: Pakistan govt working to abolish 18% GST, says minister
ISLAMABAD: Minister for National Food Security Rana Tanveer Hussain said on Wednesday that the government is actively working to abolish the 18 per cent general sales tax (GST) on locally-produced cotton, including lint and cottonseed, to support farmers and boost domestic cotton production. The minister made these remarks during a meeting with a delegation from the Pakistan Business Forum (PBF), led by Chief Organiser Chaudhry Ahmad Jawad. Hussain said the government is also addressing pending cotton cess liabilities in the textile sector to ensure the Central Cotton Committee (CCC) remains financially stable. 'We are considering limiting tax-free imports of yarn and fabric under the Export Facilitation Scheme (EFS) to encourage local cotton consumption,' he added. PBF urges govt to take urgent measures to save cotton He stated that the government aims to produce 10 million cotton bales this year and is committed to offering relief to farmers in the next budget. The meeting discussed in detail the upcoming federal budget and advocate for targeted relief for the agricultural sector. The PBF delegation included Senior Vice President Amna Awan, Chairman South Punjab Talat Suhail, Chairman KP Ashfaq Paracha, and Deputy Secretary General Zafar Iqbal. PBF Chief Organiser Chaudhry Ahmad Jawad urged the government to eliminate the GST on local cotton and lower customs duties on imported machinery for the cotton ginning sector. 'Sustainable economic growth is not possible without strong support for agriculture,' he emphasised. Jawad also called for the implementation of new seed varieties developed by the Pakistan Agricultural Research Council (PARC) at the district level. 'Farmers are unaware of the latest research being carried out in Islamabad. It needs to be transferred to the grassroots through local agriculture departments,' he said. The government must take concrete steps to reduce the cost of cultivation. Fertiliser prices should also be brought down by offering tax relief, added Jawad. Copyright Business Recorder, 2025
Business Recorder
3 days ago
- Business
- Business Recorder
Local cotton: Govt working to abolish 18pc GST: minister
ISLAMABAD: Minister for National Food Security Rana Tanveer Hussain said on Wednesday that the government is actively working to abolish the 18 per cent general sales tax (GST) on locally-produced cotton, including lint and cottonseed, to support farmers and boost domestic cotton production. The minister made these remarks during a meeting with a delegation from the Pakistan Business Forum (PBF), led by Chief Organiser Chaudhry Ahmad Jawad. Hussain said the government is also addressing pending cotton cess liabilities in the textile sector to ensure the Central Cotton Committee (CCC) remains financially stable. 'We are considering limiting tax-free imports of yarn and fabric under the Export Facilitation Scheme (EFS) to encourage local cotton consumption,' he added. PBF urges govt to take urgent measures to save cotton He stated that the government aims to produce 10 million cotton bales this year and is committed to offering relief to farmers in the next budget. The meeting discussed in detail the upcoming federal budget and advocate for targeted relief for the agricultural sector. The PBF delegation included Senior Vice President Amna Awan, Chairman South Punjab Talat Suhail, Chairman KP Ashfaq Paracha, and Deputy Secretary General Zafar Iqbal. PBF Chief Organiser Chaudhry Ahmad Jawad urged the government to eliminate the GST on local cotton and lower customs duties on imported machinery for the cotton ginning sector. 'Sustainable economic growth is not possible without strong support for agriculture,' he emphasised. Jawad also called for the implementation of new seed varieties developed by the Pakistan Agricultural Research Council (PARC) at the district level. 'Farmers are unaware of the latest research being carried out in Islamabad. It needs to be transferred to the grassroots through local agriculture departments,' he said. The government must take concrete steps to reduce the cost of cultivation. Fertiliser prices should also be brought down by offering tax relief, added Jawad. Copyright Business Recorder, 2025
Express Tribune
3 days ago
- Business
- Express Tribune
PBF urges budget relief for agriculture
Listen to article The Pakistan Business Forum (PBF) has urged the government to take concrete measures in the upcoming federal budget to reduce the cost of agricultural cultivation, calling for immediate tax relief on fertilisers to ease the financial burden on farmers. A PBF delegation, led by Chief Organiser Chaudhry Ahmad Jawad, held a detailed meeting with Federal Minister for National Food Security Rana Tanveer Hussain to discuss the upcoming federal budget and advocate for targeted relief for the agricultural sector. The delegation emphasised that the federal government still holds the authority to reduce the cost of production for farmers. "Sustainable GDP growth is not possible without government support for agriculture," they stated. The delegation urged the government to eliminate the 18% GST on locally produced cotton and to reduce customs duties on imported machinery used in the cotton ginning sector. "The government must take concrete steps to reduce the cost of cultivation. Fertiliser prices should also be brought down by offering tax relief," they added. In response, Hussain expressed agreement with the forum's concerns and stated, "The ministry is actively working on eliminating the 18% GST on local cotton, including lint and cottonseed." He further noted that efforts are underway to resolve pending cotton cess liabilities from the textile sector to ensure the Central Cotton Committee does not face financial constraints. "We are also considering limiting tax-free imports of yarn and fabric under the Export Facilitation Scheme to support local cotton," said the minister. "This year, we are aiming to produce 10 million cotton bales locally, and we are making every effort to ensure that farmers receive relief in the upcoming budget." PBF also recommended that new research and seed varieties developed by the Pakistan Agricultural Research Council (PARC) be implemented at the district level through local agriculture departments. "At present, we are unaware of the latest research being conducted in Islamabad. The ministry should work with provincial governments to bridge this gap." PBF welcomed the government's decision to allow the import of cotton seeds and proposed that legislation be introduced to ensure local banks provide loans to the SME sector.
Business Recorder
5 days ago
- Business
- Business Recorder
PBF urges growth-focused budget in light of regional, economic situation
KARACHI: The Pakistan Business Forum (PBF) has urged the government to present a growth-focused budget in light of the current regional and economic situation. PBF President Khawaja Mehboob ur Rehman stressed that the upcoming budget must prioritize economic stability instead of just revenue generation. He warned that imposing more taxes could lead to an economic slowdown and harm long-term national interests. A budget that focuses only on meeting tax targets without addressing business and inflation concerns could worsen public and industrial stress. PBF also highlighted concerns over the government's reported plan to increase petroleum levy up to Rs100 per litre from July 1. Additionally, further taxation on electricity is being considered, which the forum believes will severely restrict economic activity. These measures, if implemented, could burden the already strained business sector and reduce industrial productivity. The forum believes such policies could discourage investment and delay recovery from the ongoing economic crisis. Businesses are already facing rising operational costs and shrinking margins. According to the Pakistan Business Forum, the government is also considering increasing tax targets by Rs2,000 billion in the new fiscal year. This figure, in their view, is unrealistic given the fragile state of the economy. Such a heavy tax burden would be unfair to the business community, which is already dealing with inflation and uncertainty. The forum recommended that the budget avoid new taxes and instead focus on relief for businesses and consumers. A more balanced approach could protect jobs and stabilize market conditions. The upcoming budget, scheduled to be announced on June 10, should provide direct support to the business environment and offer genuine inflation relief. The forum proposed reducing development expenditures and diverting those resources towards defence and economic recovery. They emphasized that the Ministry of Finance must acknowledge the exceptional nature of current challenges. Both the general public and national institutions cannot bear further inflation or instability. A responsible, supportive budget is essential for sustaining national strength. Copyright Business Recorder, 2025
Business Recorder
19-05-2025
- Business
- Business Recorder
Weekly Cotton Review: Trading activity remains subdued
KARACHI: The cotton market witnessed overall stability, though trading activity remained subdued. In the international market, New York cotton maintained a downward trend. On the domestic front, a significant development emerged as the government, after a 50-year gap, finally allowed the import of cotton seed in an interview, Muhammad Adil Naseem Oswala stated that one of the major reasons for the decline in the cotton crop in the country is the government's flawed policies, particularly due to energy and the EFS, which have caused problems for spinners. He mentioned that while the EFS policy is good, it is being misused. He pointed out that because of the EFS, cotton and fabric are being imported in large quantities, especially Chinese cotton yarn, which is being imported in excessive amounts, creating difficulties for spinners. Additionally, fabric is also being imported, and the government needs to reconsider its EFS policy. Due to the EFS and expensive energy, many mills are shutting down, while others are operating partially. The government must adopt a positive policy for the cotton and textile industry; otherwise, in the current situation, the textile sector—especially spinning mills and the denim industry—will continue to close down In this regard, Nadeem Shah, President of the Sindh Seed Association, issued a clarifying statement detailing the import-related provisions. Meanwhile, the Pakistan Business Forum has demanded the removal of the General Sales Tax (GST) on cotton in the upcoming federal budget. Industry circles emphasize the need for immediate and practical measures to ensure the sustainable growth of the textile sector. According to Patron- in -Chief Pakistan Textile Exporters Association Khurram Mukhtar, progress in this sector is unlikely without resolving its persistent challenges. Additionally, experts from the ginning and spinning industries have criticized government policies, stating that flawed decisions have severely impacted these sectors. Adil Nasim Osawala stressed that the government must take serious steps to address the industry's pressing issues without delay. Last week, the local cotton market overall remained stable, with limited trading activity. Cotton deals were finalized at prices ranging from 16,700 to 17,500 rupees per maund, depending on quality and condition. The stock of cotton with ginners is gradually decreasing. Advance deals for the new crop (2025-26) of Phutti and cotton are taking place. In Sindh, Phutti traded at 8,300 to 8,500 rupees per 40 kg, while cotton was sold at 17,300 to 17,500 rupees per maund. It is being said that by the third week of May, two or three ginning factories in Punjab are expected to partially start operating using cottonseed from Sindh. In several cotton-growing areas of Sindh and Punjab, Phutti production is underway, and partial picking has also begun. The Federal Committee on Agriculture has set a production target of 10.18 million bales of cotton for the upcoming 2025-26 season. All Pakistan Textile Mills Association (APTMA), Pakistan Cotton Ginners Association (PCGA), and Federation of Pakistan Chambers of Commerce and Industry (FPCCI) have repeatedly appealed to the government regarding the continuation of the Export Facilitation Scheme (EFS) and are persistently urging action, but so far, no decision has been made. Hopes are raised at times, only to be dashed later. Currently, there are reassurances regarding EFS for the textile sector, but during a recent Senate session, hints were given that it may be difficult to reach a decision on EFS in the upcoming budget. Nevertheless, textile industrialists and PCGA cotton ginners continue to submit requests for EFS, holding meetings and press conferences through FPCCI and other organizations, emphasizing the need for a level playing field for EFS facilitation. However, no positive steps have been taken so far. A delegation including PCGA Chairman Dr. Jesu Mal Leemani, former Chairman Sohail Mahmood Haral, and APTMA Chairman Kamran Arshad met with Prime Minister Shehbaz Sharif, where assurances were given that sales tax on local cotton and other by-products would be abolished in the budget. Meanwhile, the Pakistan Business Forum has demanded the elimination of GST in the budget. In the provinces of Sindh and Punjab, the price of cotton per maund ranges from 16,700 to 17,500 rupees based on quality and condition. Advance deals for the new crop have been settled at a price of 17,300 to 17,500 rupees per maund. The Spot Rate Committee of the Karachi Cotton Association has maintained the spot rate stable at 16,700 rupees per maund. Naseem Usman, Chairman of the Karachi Cotton Brokers Forum, said that international cotton prices are fluctuating. The futures price of New York cotton is trading between 64.50 to 69.50 American cents. According to the USDA's weekly export and sales report, 122,200 bales were sold for the year 2024-25. Vietnam remained at the top by purchasing 95,600 bales. Bangladesh secured the second position by buying 26,200 bales. Indonesia ranked third with the purchase of 6,300 bales. For the year 2025-26, 34,200 bales were sold. Honduras led by purchasing 25,400 bales. Indonesia came in second place by buying 8,800 bales. In an interview, Muhammad Adil Naseem Oswala said that one of the major reasons for the decline in the cotton crop in the country is the government's flawed policies, particularly due to energy and the EFS, which have caused problems for spinners. He mentioned that while the EFS policy is good, it is being misused. He pointed out that because of the EFS, cotton and fabric are being imported in large quantities, especially Chinese cotton yarn, which is being imported in excessive amounts, creating difficulties for spinners. Additionally, fabric is also being imported, and the government needs to reconsider its EFS policy. Due to the EFS and expensive energy, many mills are shutting down, while others are operating partially. The government must adopt a positive policy for the cotton and textile industry; otherwise, in the current situation, the textile sector—especially spinning mills and the denim industry will continue to close down. Meanwhile, Pakistan has recently lifted a 50-year ban on the import of cotton seeds, and some are hailing it as a major achievement. However, in reality, this decision is a sign that our own agricultural system is not functioning properly. It means our government has not taken adequate measures for cotton research, seed production, and quality control. Zain Iftikhar Chaudhry, Regional Chairman of the Lahore Federation of Pakistan Chambers of Commerce and Industry, and Shahzad Ali Malik, former Chairman of the Pakistan IT Hybrid Seed Association, addressed a press conference at the FPCCI Regional Office in Lahore. They stated that cotton is not just our crop but the backbone of our economy. For several years, the cotton sector has been facing immense challenges. The industry repeatedly warned that if cotton was not saved, the textile industry would collapse. Allowing the import of cotton seeds is the first step toward improving the textile industry. The lifting of the import ban is a welcome move. Shahzad Ali Malik expressed gratitude to Prime Minister Shehbaz Sharif for ending the ban on cotton seed imports. In 2014, cotton production was 14 million bales, which has now dropped to 5.5 million bales. Around 800 ginning factories and 120 textile mills have shut down. Pakistan has previously allowed hybrid seeds for corn and rice, leading to rice yields reaching up to 120 maunds per acre. Now, with the approval of hybrid cotton seeds, a revolution in the cotton sector is expected soon. The Pakistan Business Forum has demanded that the federal government eliminate the GST (General Sales Tax) on local cotton in the upcoming budget to promote the domestic cotton industry. A spokesperson for the forum stated that if the government continues its policy of allowing duty-free imports of American cotton, it would amount to 'step-motherly treatment' toward Pakistani cotton, which could harm local farmers and the textile industry. In this regard, Chief Organizer Ahmed Jawad has called for an annual allocation of one billion rupees in the budget for the Central Cotton Committee to facilitate advanced research, quality control, and the provision of modern technology for cotton farmers. He emphasized that strong central measures are needed to improve the yield and quality of Pakistani cotton; otherwise, the country's reliance on cotton imports may increase. Let us define the proposed intervention of the guard system as it could become a ray of hope for the paralyzed cotton crop. To break free from this stagnant situation, which is gradually worsening, all available opportunities must be utilized. Along with strengthening the internal system of cotton seeds, our farmers need to be granted access to elite germplasms available in the international market (farmers' right). There are also prospects for the development of the indigenous cotton seed industry. However, to avoid surprises, we strongly recommend adopting cotton plant protection and quarantine measures. Great appreciation for Dr. Ghazanfar Ali Khan, who knows cotton very well and is a distinguished former cotton researcher. In my opinion, it is not correct to say that all public and private sectors have stopped working on germplasm. Central Cotton Research Institute (CCRI) Multan has established a gene bank. It is extremely concerning that the only organization Pakistan Central Cotton Committee (PCCC) in the country has been destroyed due to the unavailability of funds for further advanced R&D. Similarly, other institutions also have their breeding stock. This must be maintained. There is a strong emphasis on the need to further enhance the role of the Sindh Seed Corporation, while strengthening the regulatory role of federal seed certification could yield better results. Experts suggest that prioritizing locally produced seeds over reliance on foreign varieties can help achieve desired outcomes. Recently, the Sindh Seed Council approved new varieties of CCRI Sakrand, while the Punjab Seed Council has also approved CCRI Multan varieties. In Sindh's cultivated areas, varieties such as Sindh-1, Konj, Mehran, and Shahzadi have demonstrated excellent performance during early sowing. All these varieties have been developed and introduced for farmers by the Sindh Agriculture Department. Copyright Business Recorder, 2025
