All Pakistan Textile Mills Association Chairman SM Tanveer has appealed to Prime Minister Nawaz Sharif and Federal Finance Minister Ishaq Dar for announcement of the textile industry package. "Serious textile industrialists are planning downstream integration to add another $13 billion to the exports and help the country to get rid of loans from international donors at eight percent mark up," he added.
"An increase of $13 billion export in next three years would create another 13 million jobs in the country." He said the Prime Minister had himself agreed in his five hours long meeting with the textile industry associations on September 11 that Pakistan textile industry had been lagged behind in the region and he had assured of announcing a textile package within five days. The industry was eagerly waiting for the announcement of textile package from the prime minister, he added.
Tanveer maintained that the high cost of doing business was constantly resulting into closure of textile units. Therefore, the PM had directed to reduce the power tariff by Rs 2.15 per unit soon after the meeting when the textile industry associations had advocated for supply of electricity at nine cent per unit in line with the regional competitors. However, he lamented that in a situation where the textile industry was not viable on Rs 13 per unit, the mills have received Rs 18 per unit electricity bills for the current month. It is ironical that the industry was vying for Rs 9 per unit electricity while the power distribution companies have issued Rs 18 per unit electricity bills.
He said the textile industry was sustaining losses over the last one year and the mills are facing problem in paying salaries to their staff. Besides, he stressed, the imposition of Rs 200/MMBTU gas infrastructure development cess with retrospective effect has added fuel to the fire. The issue is yet pending with the Supreme Court after a decision in favour of industry from the higher courts. The government should immediately implement the Senate Committee on Textile Industry recommendations on the GIDC issue, he demanded.
He has further proposed the government to impose 20 percent regulatory duty on the import of textile raw material right from yarn to garments. It would ensure an early revival of the industry, he added. He said the domestic textile industry had a potential of $7 billion per annum, which was being marred by the unbridled entry and dumping of the highly subsidised textile products from India and China. The import duty on textile products in Pakistan was merely five percent against 30 percent in the competing countries. It needs an immediate upward revision.
He said the government should also announce rebate on the textile exports as an incentive under the focus market policy even if it was unable to devalue Pak rupee against dollar. The competing countries were already offering heavy rebate on exports, he added. He said a production capacity of $3.5 billion was already in dormant while another $2 billion capacity was under a severe threat of closure in case no immediate revival takes place with the intervention of the State Bank of Pakistan. He has suggested the government to constitute a joint committee of APTMA and the SBP to deal with the situation. Also, he said, that step would boost investors'' confidence to fetch new investment through BMR and secure the export orders.
He said an uninterrupted energy supply on priority was a must for textile industry but depressing reports were emerging every now and then that there would be no gas available to the textile industry in coming winter. Such an uncertain situation would make it difficult for the industry to get export orders for the upcoming fall and winter season. Therefore, this is high time to ensure energy supply to the industry on regionally competitive price.
He assured that the government would be in no need of seeking $500 million from the IMF in case it revived the textile industry and enabled it to earn foreign exchange out of domestic sources. He has expressed the hope that the prime minister and the economic managers would understand the severity of the situation and announce a textile package before Eid.-PR