The value-added textile sector has approached the Ministry of Textile Industry for immediate ban on export of raw cotton and yarn, for minimum three months, or until the final damage to the crop is ascertained. Showing serious concern over the damage to cotton crop in the flood-hit areas, textile exporters have asked the ministry for temporary ban on export of all kinds of raw material to support local textile industry.
They said that this is the time when import of some 4 million bales is already has been estimated by experts, the government should take the decision of banning export of raw cotton and cotton yarn in the greater national interests.
"It's imperative that we should use the cotton crop very intelligently and the government should impose a ban on export of raw cotton and cotton yarn as millions of jobs are associated with textile sector having a contribution of 55 percent in the country exports," said Muhsin Ayub Mirza, chairman of Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA).
He said that unexpected floods had damaged three major crops including cotton, rice and sugarcane. Cotton is the backbone of textile industry and if the government does not impose ban on the export of cotton and all types of yarn, the country's largest export sector would face huge losses in terms of short exports and high cost of production.
"We have also approached the ministry of textile industry and asked Muhammad Farooq for a temporary ban on export of all raw material including cotton and cotton yarn," he said, adding that the government should prefer the local industry first and export raw materials should be allowed after the final estimations of cotton crop damage, otherwise the country's textile industry would be forced to shut operation due to unavailability of yarn.
Muhsin said that cotton and yarn export of any kind should be banned for at least three months to stabilise the exports of value-added sector of the country, as already the some abrupt increase in yarn prices has been witnessed in domestic market and volatility in cotton prices is putting the industry under heavy pressure, which could result in losing the market to competitors.
It is already estimated that after cotton crop losses, some 4 million cotton bales would have to be imported for local consumption and ahead of this estimates the cotton prices are soaring in local market reaching Rs 6500 per maund. If export of cotton would not be banned then its import would surge to 6 million bales by end of this fiscal year.
He also urged the government to make serious efforts for market access, as after the tsunami disaster Lanka had got the status of GSP plus from EU countries. "Since the damage of flood has been estimated by UN more than tsunami we should request EU countries and USA to come and help Pakistan in terms of market access since this could be a great help in creating jobs for a lot of displaced people," Muhsin said.
He said that delayed action can hamper the textile export, resulting in closure of industry and unemployment of thousands of people. This is the time where govt should take the decision of banning cotton and yarn in the greatest national interest and at any cost this should not be delayed, he said.