Cotton Yarn is being exported on lesser average unit price of 1.91 dollar per kg at present as compared to earlier year's average unit price of 2.06 dollar in 2005-06, 2.15 dollar in 2006-07 and 2.34 dollar in 2007-08 respectively not withstanding the currency depreciation factor.
On the other hand the export of fabrics is fetching average unit price of 1.10 dollar per square meter against earlier year's average unit price of 0.80 dollar. Thus loss to national exchequer in foreign exchange earnings for exports of raw material is quite apparent from the above figures. Country could have earned 1.87 billion dollar in export if the cotton yarn export at lesser price would have been converted in to value added items.
This analysis was depicted by Khurram Mukhtar, Chairman and Sohail Pasha, Vice Chairman Pakistan Textile Exporters Association (PTEA) during a briefing to newsmen here on Thursday. Similarly, we could have earned 353 millions dollar with the export of value added items from the same quantity of 60,000 metric ton of raw cotton from which only 70.5 millions dollar have been earned. The earning lesser foreign exchange equivalent to 282.5 millions dollar.
Pleading for immediate restrictions on export of raw materials against value added items, PTEA Chairman stated that we are axing our own feet by providing cheaper raw materials to our competitors while damaging our own industry and exports. Further more the country would also be thrown into turmoil due to lying off millions of workers which the value added chain was presently employing, they added. It was further pointed out that value added sector did not want to scuttle the cotton and spinning sectors but was in favour of carving a consensus on mutually agreed and beneficial terms so that all the sectors of textile business could be able to survive and progress honourably.
They further stated that attractive export orders for raw material comprising cotton and cotton yarn were not new phenomenon as this had been occurring in earlier years as well. But we should learn from past history when the raw material items cotton and cotton yarn were similarly exported at lower prices but had to be imported back into the country at higher prices when the domestic market faced the shortage and industry was on the verge of total collapse. Loss of precious forex was in addition to this loss, they stated.
PTEA office-bearers said that they believe in safe guarding the rights and privileges of all sectors of textiles and also believed in open competition but were not prepared to damage the industrial base of the country which was highly labour intensive as also ruining the foreign exchange earning base of the country.
PTEA Chairman warned the Government to take immediate cognisance of the serious. Situation, and take remedial measures urgently failing which total collapse of the industry of exports, and national economy was imminent.