Mills may occupy the cotton body

Islamabad:

The government is considering handing over the Pakistan Central Cotton Commission (PCCC), which conducts research to improve cotton quality, to the All Pakistan Textile Mills Association (Aptma).

The committee is facing a financial crisis due to the inability of the textile workers to pay their dues. The millers are reluctant to pay for the cotton and have filed lawsuits in this regard. Following this, the government decided to dissolve the PCCC, an institution set up to undertake research work to improve the quality of Pakistan’s cotton crop, which is the basis for the textile industry.

The government is working on two proposals. The first proposal involves the handover of PCCC, which works as an attached department of the Ministry of National Food Security and Research, to Aptma, a major textile organization.

The second proposal entails transferring the PCCC to the National Agricultural Research Center (NARC).

Earlier, the Economic Coordination Committee (ECC) noted that the PCCC had become ineffective due to its financial problems. He therefore recommended the closure of the agency.

The ECC directed the Ministry of National Food Security to prepare and submit a case to the Cabinet Committee on Rights along with the way forward to continue the cotton survey after the dissolution of the PCCC.

In addition, the ministry of food security was tasked with consulting the Attorney General of Pakistan and the attorney generals of the provinces to expedite the settlement of court cases involving withdrawal payments.

Following this, the ECC, in a recent meeting, was informed that two proposals were being considered, which included whether the cotton commission should be handed over to Aptma or NARC.

According to the food ministry, since 2016, the mills were reluctant to pay the cotton and filed 65 cases in various high courts and the Supreme Court. This has resulted in significantly reduced profits for the PCCC, leading to partial salary payments over the past two years.

While cotton research is vital to the agricultural economy, structural issues remain. The compensation, imposed in the private sector, funded research in the public sector, mainly covering employee-related costs. The CySEC proposed that the investigation be carried out by the private sector instead.

The food security ministry informed the ECC that the cotton commission had received a loan of Rs 656 million for employee-related expenses in the federal budget for the financial year 2024-25.

PCCC, established in 1948 under the Cotton Cess Act 1923, functions under the Ministry of National Food Security with a mandate to promote cotton research, increase production and improve marketing through a release of Rs 50 per bale of cotton, which collected from textile mills.

Since 2016, the mills have been resisting the waste payments, especially after the rate was increased from Rs 20 to Rs 50 per bale, as recommended by the ECC in 2012, and the levy on imported cotton.

Although the PCCC won 63 out of 65 legal cases, with only two pending in the Peshawar High Court, the lack of settlement payments has severely affected the release of workers’ wages and pensions, which have been cut by 50% and 80% respectively. %, respectively, since June. 2022.

To meet the shortfall, the federal government provided an additional grant of Rs 419 million in May 2021. In addition, the ECC approved a loan of Rs 300 million in June 2023 to ensure payment of salaries and pensions. However, the loan was not disbursed because the fiscal year ended on June 30, 2023.

The ECC also directed the food ministry to devise a permanent solution for the economic viability of the cotton commission.