Yarn quota issue: apparel sector worried over judicial relief provided to spinners

Apparel sector is worried over judicial relief provided to the spinners on quota restrictions against yarn exports and has started criticising the Textile Ministry for leaving it in the lurch on the issue.
Chief Co-ordinator Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) Ijaz A. Khokhar told Business Recorder that the apparel sector was in a fix like situation due to the dilly-dallying attitude of Textile Ministry on the issue, especially after the judicial relief to the spinners. He said the spinners were expecting Textile Ministry to challenge the judicial relief in the apex court immediately to save the value-added sector.
He said Textile Ministry should either issue another SRO after the annulment of the first one by the superior judiciary or impose regulatory duty of 25 percent on export of cotton yarn to ensure raw material for the value-added sector locally.
It may be noted that the Lahore High Court (LHC) has joined both the Sindh High Court (SHC) and the Peshawar High Court (PHC) in rescuing the spinning industry on Thursday. The superior judiciary came forward to the rescue of the spinning industry and has extended relief to 26 export-oriented spinning units against quota restrictions on exports of yarn.
The Textile Ministry had imposed quota of 50,000 tonnes a month on export of yarn on January 8, followed by further reduction to it on February 22, inviting anger from spinners across the country. A call from the Aptma leadership resulted into a successful countrywide strike against the decision on March 18.
The spinning industry sources said that 26 export-oriented spinning units, being granted with the relief, export 50 percent of the total yarn from the country. It means that the Textile Ministry's decision has been ineffective virtually. Ijaz Khokhar said the apparel sector was unhappy with the situation, as the Governor Punjab-led negotiations have also been suspended with the judicial relief and now the apparel sector was clueless about the future course of action.
According to him, Euro prices have declined by 10 percent recently as it is being traded at Rs 112 for each Euro against Rs 126 earlier. When asked about the outcome of the Governor House negotiations, he said the apparel sector was ready to increase the quota limit to 38,000 tonnes a month but the Aptma delegation was adamant to enhance it to 46,000 tonnes a month. Negotiations were underway until judicial relief was granted by the three high courts, which lead to an end of the negotiations.
Ijaz Khokhar feared that the prevailing situation might be dangerous for the continuity of operations in apparel sector, which would result into more factories shutting down and job losses. He expressed hope that the Federal Minister for Textile would be as supportive to the value-added sector, as he was before the judicial relief provided to the spinning industry.