Ministry of Commerce and Textile is likely to submit a revised summary to the Economic Coordination Committee (ECC), proposing the continuation of ongoing package and withdrawing the condition of 10 percent increase in exports for getting drawback of local taxes and levies, it is learnt. Sources revealed to Business Recorder that chances for approval of new export package promised by the finance minister in his winding-up speech on the budget 2017-18, are small due to severe fiscal constraints.
Officials in the Finance Division said the top bureaucracy of the Ministry has reservations over the new package and it is unlikely to sail through the ECC; additionally it was concerned about funding the package as no allocation was earmarked for it in the budget. Textile industry stakeholders concur and complain bitterly about the government's sustained failure to meet its promises for providing relief to industry.
All Pakistan Textile Mills Association (APTMA) representatives said govt last week agreed to reduce electricity price by Rs 3 per unit and provide enhanced supply of natural gas to the textile sector for increasing exports. Subsequently Finance Minister Miftah Ismail announced at the joint media briefing with APTMA that the ECC will give final approval to the agreement on Thursday (May 17). But the govt failed to fulfil its commitment. "We are not expecting any relief from the government with a few days left in its tenure, but the textile industry in Punjab is facing 10 hour load shedding daily," they added.
APTMA officials said textile sector is also facing liquidity problems due to failure of the government to clear their pending refunds and rebate as announced in the textile package for the past one and half years. Jawed Bilwani, Chairman, Pakistan Apparel Forum, Chief Coordinator, Value-Added Textiles Associations said export promotion remains a low priority area reflected by the govt's lack of commitment, non-seriousness and unwillingness to release refund claims of billions of rupees.
PML-N led govt announced an export package of Rs 180 billion in January 2017 and only Rs 21.5 billion (16.38 percent of the total package) has been released to-date. The Prime Minister, earlier gave assurance that all pending refunds and rebates will be released by 15 Feb, 2018 which was never carried out.