The Trading Corporation of Pakistan (TCP) failed to attract textile mills or traders for cotton procurement as its sixth cotton tender did not fetch a single bid. Textile mills were reluctant to procure cotton from the state-run grain trader and there was no participation in the consecutive second tender announced by TCP to offload cotton stocks procured from the domestic market to facilitate farmers.

The Federal Board of Revenue imposed a 10 per cent advance tax on cotton procurement from TCP due to which textile mills and traders are reluctant to procure cotton from TCP. As per the tender condition, successful bidders are required to pay an advance tax at the rate of 10 per cent, which will be later adjusted in their annual tax returns.

TCP issued the sixth cotton tender on September 18, 2015, for the sale of 84,600 cotton bales and accordingly the tender was opened on September 30, 2015, at the corporation's head office. In response to TCP's sixth cotton tender not a single buyer or textile mill or trader participated in the tender.

In order to stabilise cotton prices in the domestic market, the federal government, in November last year, asked TCP to procure cotton from ginning factories to facilitate farmers. Accordingly TCP procured 96,000 cotton bales from ginners.