FBR issues SRO for zero rating import of textile machinery

The Federal Board of Revenue (FBR) has issued SRO to facilitate textile industry for zero rating import of textile machinery during current fiscal, said reliable sources. According to the sources, the spinning industry is planning to invest further to consume about 15 million cotton bales ahead. The textile industry would keep growth momentum intact during current fiscal like the outgoing one, registering record $14 billion exports in total, they added.
It may be noted that President Asif Ali Zardari has already declared 2011 as the year of textile industry, taking many steps to facilitate the industry right from ensuring free market mechanism to five days a week uninterrupted gas supply to textile industry for power generation and present SRO for zero rating import of textile machinery.
It is also worth noting that the spinning industry has booked impressive profits during outgoing fiscal amidst unprecedented cotton prices in the international market. Now the industry is set to invest two to three billion dollars to expand capacities, said the sources. The present installed capacity of textile industry falls around 12 million spindles countrywide.
According to the industry sources, power crisis is a major challenge for the textile industry, especially when the SNGPL is not sure about continuity of gas supply during winter. Majority of industry is looking for alternative source of energies to keep their mills operational. They are quite confident of overcoming the power crisis to produce more and more raw material for downstream industry.
However, the value-added industry is not happy with the situation. The present fall in cotton prices has put it into a troublesome situation, as the international buyer is shying off placing fresh orders in a highly instable cotton marker situation. Interestingly, the federal government has also denied duty drawback facility to woven and knitwear industry in the budget 2011-12. Not only this, it has also left the value-added exporters clueless about payment of stuck up claims under the same scheme.