The Ministry of Textile Industry has demanded of the government to delay the abolition of negative list with India till the creation of level playing field, informed sources revealed to Business Recorder. The Ministry has also demanded for devising product and region-wise mechanism, prior to phasing out negative list with India to increase textile export.
The ministry has informed the Commerce Ministry about their reservations and the latter has called on a meeting to discuss the issue. The deadline for phasing out the negative list is December 31, 2012 and rapid progress is being made in this regard. However, there were reservations of the textile industry on abolition of the negative list.
Sources maintained that there is a huge difference in rates of duty in Pakistan and India mainly causing harm to Pakistani exports. They warned that when tariff will be brought down to maximum 5.0 percent under South Asia Free Trade Agreement (SAFTA) Pakistan's trade with India will suffer as the Indian tariff structure continues to remain high due to composite duties charged at Indian ports on entry. The ministry demanded that level playing field for textile sector vis-à-vis India should be ensured.
Sources said that there are four types of duties on Pakistani products including education cess, customs cess, besides custom duty etc. Ministry of Textile Industry wanted that the Ministry of Commerce must ensure level playing field before elimination of negative list.
Textile industry had earlier demanded of the government to delay the proposed Most Favoured Nation (MFN) status to India as the deal will be harmful for the local industry following current energy crisis in the country. Textile industry expressed serious reservations over the proposed MFN status to India saying that any such move will destroy local textile sector. Sources further said that India is the second largest cotton producer in the world and produce surplus cotton, however if the negative list is abolished, the open cotton trade between the two countries would badly hurt the local cotton producers.
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