Cotton import from India: proposed five percent duty to hit exports hard: Bilwani

The country's export of value-added textile will plunge from existing $11.49 billion if the government slapped additional duty on import of cotton yarn from India, exporters said on Thursday. Talking to Business Recorder, Chairman Pakistan Apparel Forum, Muhammad Jawed Bilwani expressed concerns over the proposal to place further duty on import of cotton yarn.
He alleged that the government was supporting the spinning textile sector to create more financial miseries for value-added textile manufacturers and exporters. "There is already a 5 percent import duty on the import of cotton yarn which the industry wants the government should withdraw to facilitate the apparel textile export to the world markets," he added.
"Again this proposal for imposing additional duty at the behest of some large spinners having integrated units will greatly hamper the cost of doing business of the vital value-added textile sector whose exports earnings are $11.49 billion more than spinners," he maintained.
Showing reservations, he said that the government continued to ignore the 'vital' textile stakeholders while taking decisions on imposition of duties. "Why the vital stakeholders are not being taken on board before deciding such crucial matters," he questioned. "The government is always misguided to impose additional duty on cotton yarn import from India, which inflict harm value-added textile sector, he said, adding that the move will hit hard the efforts to improve country's exports.
"Since the value-added textile sector will be unable to import cotton yarn from India owing to the current 5 percent import duty and the proposal of additional import duty, as it will greatly increase their cost of doing business and make it tough for them to face global competition while in turn will enable the spinners to increase their sales locally at prices they demand," Bilwani said.
He said that textile exports of Bangladesh stood at $24 to $25 billion despite depending on cotton yarn import, while Pakistan was struggling to compete with it on the global markets being a cotton-growing nation. "All over the world export of raw material is greatly discouraged and restricted while import of raw of material is always allowed just because of value-addition and earning of more foreign exchange. In comparison to this, in our country most unfortunately it is the opposite and essential raw material for value-additions is allowed to be exported," he added. He said that the value-added textile sector should be allowed with duty-free import of raw material without any hurdle.