Anomalous policy and an apparent partisan move is blamed for the eventual closure of six chemical manufacturing units rendering hundreds of worker jobless. The chemical is a basic ingredient for manufacturing and is used as basic input in four industries cable manufacturing, artificial leather, PVC shoes, rubber pipe (garden pipe) and floor sheets.
The chemical known as Di-octyle Phathalic-plasticizer (DoP) has been allowed duty-free import only to one party. Orthohxylene is a basic raw material to produce phthalic anhydride (PA) and DoP. PA is used at ratio of 35-percent and 2Ethyle Hexanol (2EH) at ratio of 65-percent to produce DoP while 2EH is totally imported from Saudi Arabia and Singapore.
The Central Board of Revenue (CBR) allowed zero rated import of Orthohxylene to a company which is producing phthalic anhydride and DoP while the others have to import phthalic anhydride at 10 percent duty to produce DoP which rendered them economically unviable.
''It is too difficult to survive while another company has been given favour through SRO to import orthohxylene at zero rate'' said chairman standing committee on Customs, Import Valuation and Tariff of the Lahore Chamber of Commerce and Industry (LCCI) Irfan Qaiser, while talking to Business Recorder.
Terming the issuance of SRO as discrimination with other units manufacturing DoP because of levy of 10 percent duty on the import of phthalic anhydride (H.S.Code 2917.3500), Qaiser urged the CBR to remove this anomaly that has already forced closure of six manufacturing units in the country. The remaining units still engaged in production are facing great hardships and are on the verge of closure.
He was of the view that a particular chemical company is also producing phthalic anhydride besides DoP and charging high price of its produce to exploit the situation. It does not make any difference for a DoP manufacturer if phthalic anhydride is imported from the local market or from the international market, he maintained.
He urged the government to take serious notice of the situation and remove this anomaly for providing level-playing field to all the manufacturers so that the functional units could be saved from total closure. He also demanded cutting duty on import of phthalic anhydride from 10 to 5 percent.
He was of the view that the government should take rational measures on warehouse charges and suggested that there should be no charges of warehouse for the first week.
However, the government could charge 0.5-percent for the next week and 1-percent after two weeks. If the consignments are not released even after two weeks, the government may impose heavy charges to the importers, he maintained.
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