The All Pakistan Textile Mills Association (APTMA) has called on the Federal Board of Revenue (FBR) to withdraw the implementation of video analytics at the spinning stage of the textile value chain. Instead, APTMA has recommended that the system be installed at the ginning stage, where it believes the core issue of undocumented cotton movement begins.
In a letter to FBR Chairman Rashid Mahmood Langrial, APTMA Chairman Kamran Arshad reiterated concerns about the Sales Tax General Order (STGO) and its aim to control undocumented cotton bales and the illegal ‘golmaal’ trade, emphasising that the problem of ‘golmaal’ originates at the ginning stage, not at the spinning stage as currently addressed by the FBR.
According to APTMA, discrepancies in cotton production figures, particularly those reported by the Crop Reporting Service (CRS) and the Pakistan Cotton Ginners’ Association (PCGA), indicate significant leakages at the ginning stage. The CRS has estimated Punjab’s cotton production for the 2025–26 season at 3.81 million bales, while the PCGA reports that only 2.45 million bales arrived at ginneries, revealing a discrepancy of about 1.35 million bales in Punjab alone.
“This discrepancy points to ‘golmaal’ occurring at the ginning stage, where raw cotton enters the formal supply chain. Spinners only process documented bales, and shifting monitoring to the spinning stage would not effectively address the issue,” said Kamran Arshad in the letter.
APTMA argued that focusing video analytics at the spinning stage would be ineffective and could lead to an increase in unregulated cotton trade in the informal sector. The association insists that a national cotton traceability system at the ginning stage is essential to prevent the leakage of undocumented cotton and ensure compliance.
The textile mills body has repeatedly suggested this solution to the Ministry of Commerce, the Ministry of National Food Security and Research (MNFSR), and the FBR. APTMA further stated that it would be unjustified to install surveillance equipment at spinning mills, as cotton bales are sourced from ginneries, the first point of cotton handling after it leaves the farms.
In conclusion, APTMA has requested that the existing STGO be withdrawn and replaced with a new procedure focused on traceability and compliance at the ginning stage, aiming to enhance transparency and uphold fiscal integrity in Pakistan’s cotton industry.
