The power crisis is likely to persist until January 21 when canal desilting programme would be wrapped up in the provinces. Pakistan Electric Power Company (PEPCO) sources said the present foggy spell has added fuel to the fire, as the system is witnessing constant circuit breakers besides disc insulator flashes.
Meanwhile, the industry workers have started taking violent processions out to the streets in Faisalabad and Multan, badly affected cities, owing to the heavy closure of industries there. According to the textile industry sources, spinning mills have produced record 243,500 tons of yarn in December 2009 to meet the requirement of ancillary industry.
They said record production of yarn has been achieved due to the availability of gas supply during the month to the textile industry, under the Gas Load Management Program 2009-10 and the exemption from electricity load shedding extended to the textile industry by PEPCO.
Availability of yarn at 243,500 tons /month is far more than the domestic requirement of the value added sub-sectors including home textile, knitwears, woven garments and towels at around 110,000 tons/month. Yarn export in the form of fabric both dyed & greige at around 60,000 tons leaving exportable surplus of yarn is at 72,500 tons, sources added.
The slow off-take of yarn by the ancillary industry has created sizeable surplus to carry forward. It is unfortunate that ancillary industry is once again alleging non-availability of yarn for domestic consumption and threatening uncalled for strikes. It is clearly evident that availability of yarn is not an issue.
Exporters of value added sub-sectors were unable to fulfil their export commitments due to increase in yarn prices in the domestic and international markets. Increase in yarn prices is associated with the strident rise in prices of cotton from Rs 3500/maund to Rs 4800/maund in the local market and 59 cents/lb. to 75 cents /lb, from international sources, said Gohar Ejaz Chairman APTMA Punjab.
In order to address to the issue of price, the Government should provide relief under the Textile Policy Initiatives to encourage domestic supply of yarn to the ancillary industry by a) provide duty drawback at 5% of the sales value to the manufacturer of yarn on sales made to the manufacturer and exporter of value added textile products, b) extend Export - Refinance Facility at 7.5% on deemed export basis to the manufacture and sale of yarn to the exporter of value added textiles, and c) exporters of value added textiles be directly extended support of 5% as rebate against export of textile goods made during October to December 2009.
The government is urged not to introduce any sort of intervention, curb against free exports of textiles including cotton and yarn which would prove detrimental for the industry and exports. Major event for marketing textile exports ie Heimtextile Trade Fair is to start in two weeks' time, it would be self-destruction for the textile industry if any measure contrary to the free import export mechanism is taken, Gohar Ejaz stated.
The supply of gas and electricity to the export oriented & continuous process textile industry has badly worsened from January 2010. The government is urged to provide uninterrupted gas and electricity supply to the textile industry to under take production of textile goods meant for exports, APTMA Punjab Chief concluded.
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