The newly-elected central chairman of All Pakistan Textile Mills Association (Aptma), Gohar Ejaz, has urged the US government to accord market access to Pakistan in line with the EU, as the country badly needs creation of new jobs to overcome the severe impact of floods.
"Pakistan's textile has existing inherent strength and the US should also come forward," he said, and added that "Pakistan's exports may increase by $20 billion besides creation of 10,000 jobs on each $100 million exports, which the country needs badly for its people."
He was addressing his first press conference after being elected as chairman of Aptma. He will take oath of his office by the end of September. He was accompanied by newly elected leadership of Aptma including vice chairman Shehzad Ali Khan and Punjab Aptma chairman Ahsan Rashid. Chairman of Pakistan Cotton Forum Muhammad Akbar was also present on the occasion. Gohar said that Pakistan can also overcome $10 billion deficit in case the US extends free market access like the EU.
According to him, Pakistan textile exports can increase manifold with mere use of 200MW of electricity. Terming it a 'golden opportunity', the Aptma chairman said that the EU has proved that it has understanding of issues confronting Pakistan. He congratulated the textile industry and other concerned government departments for this achievement.
The share of textile industry in Pakistan's exports of $5 billion to the EU is $3 billion. He said Aptma has always been stressing for trade and not aid from the EU and the US. Highlighting the importance of free market access, Gohar said that Bangladesh exports have shot up from $5 billion in 2005 to $18 billion in 2010.
The Aptma chairman said Pakistan's exports are stagnant over the last year and recent trade concessions from the EU would give boost to its exports. He said the estimated increase in Pakistan exports is $2 billion in one year with market access facility from the EU.
VALUE ADDED TAX (VAT) Aptma chairman also expressed concerns over the rumours that Pakistan's textile industry is being deprived of the zero-rating tax regime under the RGST, which is likely to be imposed by October 1, 2010. He said that the industry was exempted from sales tax since 2005 because of the fact that the amount of refunds was higher than the collection of sales tax from it.
He said 85 percent of textile products are exported and there is no rationale of putting it under the VAT, as VAT is a consumption tax. He feared the government would be burdened by a circular debt of Rs 100 billion of textile industry refunds in case it puts textile industry under the VAT net, leading to liquidity crunch for the industry. He expressed hope that the government would avoid withdrawing sales tax exemption to the textile industry.