Ideal Spinning Mills to Cease Spinning Operations Amid Economic Pressures

Ideal Spinning Mills Limited has announced its decision to discontinue spinning operations, a significant blow to the nation’s crucial textile industry. The company cited adverse market circumstances and escalating operational expenses as the primary reasons for this action.

The textile mill officially communicated this development to the Pakistan Stock Exchange (PSX) on Friday through a formal notice.

“During a meeting convened on July 11, 2025, the Board of Directors of Ideal Spinning Mills Limited formally approved the sale or disposal of a substantial portion of the plant and machinery associated with the company’s spinning division,” the notification stated.

According to the company, the decision was influenced by the present challenging environment for spinning, specifically concerning yarn demand and operating costs.

“Consequently, the company will cease its spinning operations but will continue to operate its weaving and socks production units,” the announcement clarified.

The Board of Directors has resolved to hold an Extraordinary General Meeting (EoGM) to obtain approval from stakeholders regarding this matter.

Ideal Spinning Mills Ltd., established on June 8, 1989, under the Companies Ordinance of 1984, is a public limited company in Pakistan. The company’s main business involves producing and selling yarn, textiles, and hosiery products.

This announcement comes shortly after the textile export sector urged the government to resolve outstanding budget discrepancies promptly, warning that continued inaction could negatively impact exports and diminish exporter confidence.

Sohail Pasha, Chairman of the Pakistan Textile Exporters Association, emphasized that Pakistan is at a critical juncture and that appropriate policy support could enable exporters to foster growth, create jobs, and ensure economic stability.

He noted that the value-added textile sector in Pakistan is currently experiencing considerable difficulties due to tax measures introduced in the Finance Act 2024, which replaced the simpler Final Tax Regime (FTR) with the more complex Normal Tax Regime (NTR).

He mentioned that export earnings are subject to a 1% advance tax deduction under Section 154, acting as a minimum tax. Simultaneously, a 1% advance tax has been implemented through the addition of sub-section (6C) to section 147; in contrast, local supplies are subject to a 1% advance tax payment.