KARACHI : Value-added textile export sector representative
has urged the prime minister to abolish all duties and taxes on cotton yarn import, saying it would help
earn much-needed foreign exchange for the country and reduce trade gap which
reached $18 billion during July-Dec period of FY2017-18.Muhammad Jawed Bilwani,
chairman Pakistan Apparel Forum and chief coordinator value-added textile
export sector ,
said that value-added textile export sector has the largest share in the total textile
exports of Pakistan to the tune of $11.08 billion (53% of total exports i.e.
$20.44 billion and 89% of total textile export i.e. $12.45 billion) and cotton
yarn is the basic raw material of value-added textile export industry and it is
not easily available in the domestic market owing to low cotton yield.
He said cotton yarn prices have been increased by 30pc and that sharp
increase in the price is making the value added textile export sectoruncompetitive in the international
market which will lead to negative impact on exports which are persistently
increasing during current fiscal. Value added textile exporters were in great
fear that if the prompt action won’t be taken by the government to ensure easy
availability of quality cotton yarn at best prices, exporters will fail to meet
their export orders which were booked six months back, he added.
Bilwani emphasized on the fact that globally import of raw material is allowed
duty free while exports of raw material is restricted to benefit value addition
to earn more foreign exchange.Bangladesh’s value added textile exports have
reached $30.24 billion (FY2016-17) as they allow duty free import of raw
material – cotton yarn and always encourage value addition which is their key
to success. Value added textile export is stagnant at $11.08 billion
(FY2016-17) due to exorbitant duties and taxes on cotton yarn import, he claimed.
He
said presently value added textile export sector is already facing stiff competition in the
global market due to highest cost of inputs – gas, electricity and water
compared to our regional competitors like Bangladesh, India, Vietnam, Sri Lanka
etc. Moreover, stitching units registered with Ministry of Textile Industry
cannot import yarn for manufacturing of garments meant for export under the
DTRE scheme.
He said that the value added textile export sector is the backbone of the nation’s export and
has the ability to uplift the exports and economy. He urged the Prime Minister
to abolish all duties and taxes on
cotton yarn import and import of cotton yarn be allowed freely from anywhere
for re-export with value addition in the light of free market mechanism to
encourage value addition for earning more foreign exchange for the country.
Source: Pakistan Observer, Pakistan Friday, 19 January 2018