The Minister of State for Commerce and Textiles, Haji Muhammad Akram Ansari, hinted at the possibility of a separate tariff slab of electricity, gas and water for the apparel-making sector, and an increase in textile exports to $50 billion.
"I will raise textile-sector issues in the ECC meeting," he told textile makers and exporters at a dinner on Friday night, which was hosted by the Pakistan Garment Manufacturers and Exporters Association (PRGMEA). He said that the government should make more efforts to boost seed development. He also asked and growers to try harder to augment exports.
He invited textile producers to offer practical proposals in a meeting likely to be arranged soon with Prime Minister Shahid Khaqan Abbasi. "I will definitely raise my voice for the textile sector in the ECC meeting, will discuss the matter with the PM," the minister said.
The country can certainly reach the $50 billion target for its textile export, he said. He urged his audience to deepen their skills in value-added textile making. At the same time, he said, the government should revisit its textile package and weed out the burdensome conditions like a 10-percent incentive bar. He said that there should be an implementation committee to monitor the process, whatever the government's expected decisions on textile issues.
He assured textile stakeholders that their issues will be resolved within 15 days. He agreed with textile producers' demand that their financial incentives should be paid together with their remittances releases from the State Bank. He said he hoped the apparel manufacturers will take advantage of LNG supplies to boost up their output. "Gas supplies through LNG have begun, though it is expensive," he added.
Haji Ansari said that the country has attained peace and stability because of the almost complete defeat of terrorism, saying that the menace has been reduced by "85 percent" compared to what it was in the past.. He said that the country needs foreign reserves amid its dwindling economic growth, and expressed the hope that textile exporters will help in the effort.
In a cabinet meeting scheduled for Tuesday, he said, "I will discuss textile issues like stuck refunds, a 10 percent condition of incentives on exports and extension of textile package to three years." He said that he will discuss with the prime minister a plan scaling down the cost of production.
The chairman Capta, Zubair Motiwala, said that the country's cotton production is 13 billion bales, but it fetches just $1.7 billion, whereas Bangladesh sells the same amount of raw material for $6 billion. He said that the government should support cotton growers to boost the quality yield of cotton for Pakistan to earn greater revenue on the world market.
He asked the government to stop the four-percent rebate on the export of yarn, which directly helps the country's competitors. The rebate could be provided on local sales of yarn, he added. He demanded the immediate release the textile sector's refunds.
He said that the government never allows the DTRE facility on export of value-added textiles. He suggested that the government allow the rupee to depreciate by 10 percent to help exports growth. He said that the government should set up seeds development bank to incentivize the growers, who should be provided with the latest cultivation technology for a better crop yield.
The chairman of the Pakistan Apparel Forum, Javed Bilwani, said that the government should provide guarantees that the seven percent incentive for textile makers will continue. He said that the textile makers are unwilling to seal deals with the foreign buyers since utility tariffs are fluctuating.
He said that the high labor wages are also the stumbling block for low textile output. He demanded of the government to consider a proposal to announce a separate slab of utilities rates for textile sector. President, Pakistan Businessmen and Intellectual Forum, Mian Zahid Hussain asked the government to start a drive to boost up the exports since the country has just $20.75 billion at present. He expressed concern that the trade deficit has soared to $35 billion.
The PRGMEA's chief coordinator, Shaikh Muhammad Shafiq, enumerated the textile sector's problems, including high cost of production and soaring utilities rates. He blamed them on the decrease in production and exports. Greater employment was another result of these problems. He asked for the textile package to be extended until 2018. The government should permit import of yarn, he proposed, and end the smuggling of fabrics into the country. The competing countries have lower utility rates, and the higher rates in Pakistan badly hurt output capacity, he added.
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