ISLAMABAD Jan 19 (TNS): Value Added Textile Export Sector has urged Prime Minister Shahid Khaqan Abbasi to abolish all duties and taxes on cotton yarn import for re-export with value addition to earn sorely needed foreign exchange for the beloved country to reduce trade gap which reached to $18 billion during July-December FY 2017-18, stated Muhammad Jawed Bilwani, Chairman, Pakistan Apparel Forum and Chief Coordinator, Value Added Textile Export Sector.
He added that Value Added Textile Export Sector has the largest share in the total textile exports of Pakistan to the tune of US $ 11.08 billion (53% of total exports i.e. US $ 20.44 billion and 89% of total textile export i.e. US $ 12.45 billion) and cotton yarn is the basic Raw Material of Value Added Textile Export Industry not easily available in the domestic market owing to low cotton yield and where cotton yarn is available of sub-standard quality at higher rates.
The cotton yarn prices has been increased by 30% percent and that sharp increase in the cotton yarn price making the Value Added Textile Export Sector uncompetitive in the international market which will lead to negative impact on exports which is persistently increasing during current fiscal. Value Added Textile Exporters were in great fear that if the prompt action won’t be taken by the Government to ensure easy availability of quality cotton yarn at best prices, exporters will fail to meet their export orders which were booked six months back, he articulated.
He emphasized on the fact that globally import of raw material is allowed duty free while exports of raw material is restricted to benefit Value Addition to earn more foreign exchange.
Bangladesh’s Value Added Textile exports has reached at US$30.24 billion (FY2016-17) as they allows duty free import of Raw Material – Cotton Yarn and always encourage value addition which is their key to success. Value Added Textile Export is stall stagnant at US $ 11.08 billion (FY2016-17) due to exorbitant duties and taxes on cotton yarn import.
Presently, Value Added Textile Export Sector is already facing stiff competition in the global market due to highest cost of inputs – gas, electricity and water compared to our regional competitors like Bangladesh, India, Vietnam, Sri Lanka etc. Moreover, Stitching units registered with Ministry of Textile Industry cannot import yarn for manufacturing of garments meant for export under the DTRE scheme.
He said that the Value Added Textile Export Sector, which is the backbone of the nation’s export and has the ability to uplift the exports and economy, most earnestly request the Prime Minister of Pakistan to abolish all duties and taxes on cotton yarn import and import of cotton yarn be allowed freely from anywhere for re-export with value addition in the light of Free market mechanism to encourage value addition for earning more foreign exchange for our beloved nation to shrink the trade gap.