Regulatory duty on polyester and cotton yarn must be withdrawn in proposed mini-budget in order to strengthen domestic manufacturing units after the recovery of export sector due to the positive steps taken by the government.
Addressing a press conference, Faisalabad Chamber of Commerce & Industry (FCCI) president Syed Zia Alumdar Hussain told that Federal Finance Minister Asad Umar had visited FCCI on October 4, 2018 and assured a number of corrective measures to revive the dwindling exports. In this connection, the facility to sent 10,000 dollars for purchase of spares have been revived while the promises to provide gas at 6.5 cents per MMBTU and electricity at 7.5 cents have also been honoured. "We are optimistic that as per their assurance, the issue to resolve the DLTL claims amounting to Rs250 billion would also be resolved up to February 15", he told, adding that these steps have yielded positive results with 2 percent increase in export and decrease in imports. Similarly the foreign remittances have also recorded 10 percent increase; he told and added that government should now focus on domestic manufacturing sector which is directly linked with provision of jobs in addition to contributing its role in the overall development of the national economy.
Continuing Syed Zia Alumdar Hussain said cotton production recorded a decline of 4 lac bales and in this connection government has already withdrawn duty on cotton but the duty on cotton yarn and polyester is still haunting the manufacturers including power loom sector. "We have been assured by the government officials during series of meetings, to resolve the issues confronted by the domestic manufacturing sector; however, a powerful mafia is hatching conspiracy to clamp regulatory duty for its own vested interests in order to sell locally made polyester at high rates by creating artificial shortage of this raw material. He told that the domestic polyester yarn manufacturing units have capacity to produce only half of our domestic need of 2, 60,000 metric tons of polyester yarn. "Similarly government should also take measures to check the abuse of DTRE (Duty Taxes Remission for Exporters) to save power loom sector from total collapse", he added.
Responding to a question, he told that the power loom was once a most thriving sector of our economy that has to bear loses of approximately of Rs20 billion only due to the price hike of raw material including polyester yarn. He further told that in 2013-14 our total exports were around 23 billion dollars. "Out of it, the share of textile sector was 13 billion dollar while its imports were around 1.5 billion dollars", he told and lamented that due to ill-conceived policies of previous government, its export declined to 12 billion dollars from 1.5 billion dollars. However, he told that 2 percent increase in textile export is clear manifestation of the dividend of current policy and facilities doled out to this sector. Similarly its related import has also declined while gap between imports and exports have been bridged up to 6 billion dollars.
He said after the positive response in export sector, we must concentrate on domestic sector which will help us to increase our overall GDP. He quoted the results of recently concluded Heimtextil international trade fair and told that Pakistani exporters have got 3 to 5 percent more export orders due to the conducive climate in Pakistan while growth of Knitwear sector has also recorded approximately 16% increase.
Quoting a statement of adviser to Prime Minister on Industry and Trade Abdul Razaq Dawood, he told that certainly the overall export will record a phenomenal and historic growth this year as government is proposing new facilities for the manufacturing sector in upcoming mini-budget. Dispelling the impression of imposing new taxes, he told that we are expecting that government will increase taxes on unproductive items like cosmetics, luxurious vehicles and costly mobile phones. Syed Zia Alumdar Hussain also expressed satisfaction over the statement of American Senator Lindsey Graham to arrange a meeting between Prime Minister Imran Khan and US President Donald J Trump. He hoped that US administration has realised the importance of Pakistan in this geostrategic situation and is contemplating to provide duty free access to Pakistani products to US markets like EU Countries that has already granted us status of GSP-Plus. He was optimistic that it will be a major breakthrough and open up a new era of sustained progress in Pakistan.
The meeting was also addressed by Chaudhry Muhammad Nawaz, Chaudhry Abdul Haq, Waheed Khalaq Rahamy, Hajji Talib Hussain Rana, Kashif Zia and Zafar Iqbal Sarwar. They also supported the demand to withdrawn duties on import of polyester and cotton yarn and told that in view of export orders negotiated during Heimtextil International Trade Fair, the conversion cost of power looms has already jumped from 35 Paisa to 45. They further told that government has released record amount of Rs8.7 billion for the payment of refund to textile sector while promissory notes of Rs12 billion would also be issued up to Feb 15 with 10 percent annual profit. They further told that government has already identified the persons and parties abusing the facility of DTRE and action would be initiated against them very soon. Later, FCCI SVP Mian Tanveer Ahmed offered vote of thanks.
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