25 percent regulatory duty on export of yarn likely

Cabinet Committee on Textiles (CCT) is likely to slap 25 percent Regulatory Duty (R&D) on export of yarn to overcome its shortage in the local market, sources informed Business Recorder on Tuesday. The cabinet body is scheduled to meet, on Wednesday (today), the Advisor to Prime Minister on Finance Dr Hafeez Sheikh.
Other members of the body include federal minister for industry, federal minister for food and agriculture, federal minister for textile and state minister for finance. Sources said that the cabinet body on textiles would take a final decision to overcome the ongoing yarn crisis which has compelled value-added textile sector to go on strike against the unfettered export of yarn and cotton that is leading to a loss of exports worth millions of rupees.
Textile ministry has completed paper work for the meeting which will consider two options: to slap 25 percent R&D or to impose complete ban on export of yarn as proposed by the value-added sector, but it is expected that R&D would be imposed on yarn export, sources maintained.
The yarn crisis is worsening day by day and the value-added sector has launched a protest movement throughout the country including Faisalabad, which is the hub of the textile industry. Earlier the textile ministry had established a Council of Elders (CoE) represented by senior persons of the value-added textile sector along with All Pakistan Textile Mills Association (APTMA) with a mandate to find a solution to the ongoing yarn crisis.
However CoE failed to resolve differences and also failed in developing any consensus that would have resolved the issue. Subsequently the ministry decided to take the lead role and decide the matter in the light of proposals tabled by both sectors. In the proposals, the value added textile sector has requested the government to either ban or slap a 25 per cent regulatory duty on exports of yarn to save the industry from closure.
Dozens of industrial units have ceased to operate due to yarn shortage whereas hosiery, towel and the remaining industry of home textile is facing severe crisis. Industrialists have urged government to take swift action to avoid further unemployment due to the closure of industries, sources added. Representatives of the value-added sector have expressed indignation at the delaying tactics in resolving the yarn issue, they said.