Value Added Forum South Punjab and All Pakistan Bedsheet and Upholstery Manufacturers Association (APBUMA) appreciated the extension in SRO 809 for two years so that duty free textile machinery could be imported to modernise the textile, spinning and weaving sectors.
Former chairman of APBUMA, Syed Muhammad Asim Shah said it is also a good decision to dispose off all pending cases of sales tax refund claims within three months. Clearance of refund claims till September 2014 would provide a financial support to exporters. Asim Shah said that government had announced an incentive for those who increase the export by 10 percent and government would grant drawback on local taxes and levies at the rte of four percent on garments, two percent on made-ups, and one percent on processed fabrics but manufacturers of neglected areas like South Punjab cannot avail this facility because they are unable to increase their production as well as exports by 10 percent because of unannounced energy load shedding.
He said that 70 percent textile industry and value added units are established in Punjab but these are facing severe shortage of power and gas as compare to Sindh province. Asim hailed the offer of several incentives by federal Finance Minister to give incentives for the textile sector in this budget. These include the beneficial duty drawback rates where exports increased by 10 percent, implementation of an Expeditious Refund System (ERS) with the aim to settle exporters refund claims before September 2014, duty free import of machinery extended till the year 2016 (SRO 809) and training of 100,000 Pakistanis in the garments and made-ups.
However, exporters seem uncertain whether the government will be able to realise its promise to refund the outstanding sales tax claims by September to end the liquidity crunch encountering the textile exporters, he reiterated. He said the Finance Minister during budget speech spoke about many development projects in all the sectors, but did not mention any proposal to slash the energy crisis at least by 50 percent immediately or any reforms to encounter the prevailing law and order situation in the country which is badly affecting the textile industries in Punjab and Karachi.
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