ISLAMABAD: Commerce Ministry has reportedly opposed abolishment of cotton cess, which according to the Karachi Cotton Association (KCA) is a major hurdle in textile industry's development. Commerce Ministry has agreed to formulate a proposal for the Trade Policy 2011-12 to credit Export Development Fund (EDF) directly to the account of the Ministry.
Sources told Business Recorder that the Commerce Ministry has expressed its willingness to increase subsidy to trade delegates to $150 per day, instead of $300 originally requested. A proposal of Pakistan Sports Goods Manufacturers and Exporters Association on freight subsidy for exporters of upcountry on transportation charges up to Karachi to bring them at par with Karachi-based exporters has been rejected. However, input has been sought from the TDAP. A proposal of Pakistan Cutlery & Stainless Utensils Manufacturers and Exporters Association for 20 percent compensatory rebate on export bills has been clubbed with the proposal on subsidy.
A proposal to increase ratio of subsidy on trade fairs has also been sent to TDAP. The Commerce Ministry has agreed to include a proposal on pharmaceutical exports to Afghanistan labelled for 'Exports only'. A proposal of American Business Council is being discussed with FBR for pharmaceuticals. The ABC says that pharmaceuticals, when exported to Afghanistan and invoiced in rupees, should also be allowed export rebate that is in line with convertible currencies.
Sources said that three percent research and development (R&D) facility is expected to be announced across the board to all non-textile sectors in the Trade Policy. The Commerce Ministry has sent a proposal of Pakistan Tanners Association to National Tariff Commission (NTC) for reduction in duty on chromium sulphate, formic acid and fat liquors as the main raw material of leather industry.
The Ministry is expected to announce leather sector development package in the Trade Policy, including ad hoc relief in the shape of additional duty drawback at one percent of export value to the exporters of leather industry. Two proposals of Pakistan Gloves Association, Sialkot, ie arrangement of warehouse facility in USA and EU and distribution of subsidy equally between the organisers and exhibitors, have been sent to the TDAP.
Some of the proposals of Pakistan Leather Garments Manufacturers & Exporters Association, Karachi, have been sent to TDAP which include revision of duty drawback rate on export of leather garments and leather goods. Pakistan Hosiery Manufacturers and Exporters Association in its proposals has demanded that exports of such essential raw material be only allowed after meeting the requirement of the domestic and export-oriented industries and surplus quantity only be allowed to be exported. Further, in order to regulate and monitoring such exports it is imperative that exports are registered. The Commerce Ministry has sent this proposal to the Ministry of Textile Industry.
Pakistan Jute Mills Association's proposal of soft loan to jute industry will be discussed in the committee on trade financing. Commerce Ministry has supported a proposal of Pakistan Fisheries Exporters Association regarding exemption on import of equipment and machinery for seafood items from payment of sales tax. The Commerce Ministry will disallow import of used auto parts after payment of penalty, and the present condition given in IPO will be amended to read as 'auto parts', including serviceable auto parts imported as steel scrap.