The Karachi Chamber of Commerce and Industry (KCCI) appreciated Prime Minister Shaukat Aziz for presenting a balanced budget and preparing certain measures for reduction in cost of doing business said that the value-added textile manufacturing-cum-export sector particularly knitted and woven garments as well as towel and bed linen have been left untouched.
In a letter written to Prime Minister Shaukat Aziz, the Acting President of KCCI, Muhammad Naqi Bari said the industries are passing through serious crisis due to the onslaught of competition from Bangladesh, China, India, Cambodia, Vietnam and other countries in the global market.
He suggested that the value added textile export should be given gas/energy tariff on the basis of five percent of F.O.B. value of value added textile as tariff discount to cover up the energy cost at par with Rs 36.77 MMTBU supplied to fertiliser producers.
The travel cost compensation should be also be given to exporters at five percent of F.O.B. value, the withholding income tax be reduced to 0.50 percent, Export Refinance Rate be reduced from 7.5 percent to 3.75 percent, Export Development Fund be abolished and enhancement of six percent R&D to nine percent, adding towels and bed linen.
He said that all the above stated incentives be available to the manufacture-cum-exporter subject toe registered with Sales Tax Department, member of relevant product manufacturing associations, incentives applicable be routed through relevant associations and to control the misuse of these facilities it should not be available for exporters to Dubai and Saudi Arabia. These facilities are subject to price check from relevant associations. "Our industries are making value addition by converting raw cotton of 50 percent per pound into finished goods worth five to six dollar per piece of 1 Labs average", the letter said.
In these industries, female workers are extensively employed, as well as skill development of these workers on a long-term programme is undertaken. Moreover, about 30 supporting industries of accessories like button, zips, badges, laces tapes, labels etc are also involved and survive on the basis of these expert oriented industries.
In addition to this, processing industries of dyeing, printing and finishing are engaged in providing value addition services to final value added product for export. Besides, packaging industry which supply multiple packaging materials such as show card, inlays, labels, cartons and multiple types of polybags are also a part of the chain supply in the export of finished product.
The buyers in international market are now focusing on mass industrial production hubs and Karachi is also a significant hub of value added textile.
However, value added textile in Pakistan is facing many problems in this respect as a foreign buyer does not prefer to visit Karachi due to many negative projection of its image. "Besides, our energy cost as compared to Bangladesh is also higher. It will not be out of place to mention here that Bangladesh does not produce a single bale of cotton, but is a major competitor of Pakistan in the global market".
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