The Economic Coordination Committee (ECC) of the Cabinet has decided to withdraw 3 percent regulatory duty, 2 percent additional customs duty and 5 percent sales tax on the imported cotton from January 15, 2020.
The ECC meeting chaired by Advisor on Finance Dr Abdul Hafeez Shaikh took the decision in the light of the information provided to the ECC after the 1st Cotton Crop Assessment Committee's meeting held on October 4, 2019, wherein it was briefed that against the target production of 15 million bales of cotton for FY 2019-20, the cotton production at the end-year would be 10.20 million bales.
The chair was briefed that the bulk of the cotton will be lifted from the local farmers by 1st of January 2020 and the given exemption will not adversely affect the interests of the local farmers. On the other hand, it was also assured by the Ministries of Commerce and National Food Security & Research that the import shall facilitate the textile sector exports which are showing a rising trend.
The chair in the interest of the local farmers directed the Ministry of National Food Security and Research to devise a comprehensive policy in consultation with all the relevant stakeholders which could help in improving the production of cotton locally and serve the interests of the local farmers. The chair directed that the policy shall be presented within one month time to the ECC.
The ECC also approved the technical supplementary grant of Rs 6.21 billion during the current financial year for recurring cost of Special Security Division North of Pakistan Army. Two other technical supplementary grants were also approved for internal Security Duty Allowance to Pakistan Army (Rs 4.966 billion) and for the construction of Community Bunkers (Rs 500 million) by the ECC with the support from the Ministry of Defense.
The ECC also allowed the import of cotton from the Torkham Border through land routes from Afghanistan and Central Asian States; similar to last year, and fumigation arrangements were allowed to be made at designated areas for 2019-20.
The Ministry of National Food Security and Research and the Ministry of Commerce were directed to engage the importers for establishment of facilities at Torkham for cotton imports through the land route. Necessary steps will be initiated in Plant Quarantine Rules for providing facility of meeting SPS requirements for import of cotton through land rules.
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