Aptma chief defends RD on cotton yarn

All Pakistan Textile Mills Association (Aptma) Chairman Tariq Saud has said that the federal government has imposed regulatory duty on the import of cotton yarn in order to protect the domestic industry. "Indian mills were dumping cotton yarn into Pakistan, of which Pakistan had imposed regulatory duty as this was the only protection available to the local industry," he added.
The government step also protects the rights of genuine value added exporters who could utilise the facility of DTRE to carry on their business unhindered, he said. "This policy has proved successful and garment exports have registered a 5 percent increase. India, on the other hand, has imposed 26 percent import duty on Pakistan cotton yarn and unless we get reciprocal market access there is no other way except imposition of regulatory duty on imported yarn," he maintained.
He further said that import for re-export (DTRE) has also shown a remarkable rise increasing by over 800 percent for which we have no protection. High cost of doing business and tariff subsidy to yarn export provided to yarn exporters of India has also crippled Pakistan textile industry, especially spinning & weaving industry. Chairman Aptma urged the government to address the issue of high cost of doing business and immediately remove 4 percent custom duty and 5 percent sales tax on the import of cotton which will enable spinning industry function properly instead of being crippled further by removal of RD. Free trade in cotton will serve the interests of all segments of the textile chain and also protect the interests of the growers.
Pakistan being a key player in cotton needs to remain in line with the international market situation..... it is imperative that the stability is maintained so that the entire chain can work seamlessly. The downstream sector must appreciate the Pakistani mills for their commitment as they cannot rely on the Indian mills that have backed out of their contracts due to rise in cotton prices.
He indicated that the export of cotton yarn has drastically declined by 32 percent during the first 11 months of 2015-16 as compared to the corresponding period of last year, mainly due to non-availability of raw cotton largely due to a drastic decline in production of cotton by 35 percent in the country. The import duty @ 4 percent and sales tax @5 percent on the import of cotton may please be addressed properly, he urged the authorities concerned. Chairman Aptma further said that rise in cotton prices was due to a sudden jump in international and domestic prices of cotton.