Value added textile sector has demanded the facility of additional duty drawback to compensate the multiple domestic and international negative happenings that have adversely affected our already dwindling export. Talking to newsmen, Dr Khurram Tariq, Central Chairman Pakistan Hosiery Manufacturers & Exporters Association (PHMA) said that value added textile sector was under severe stress particularly due to the unprecedented reduction in cotton production, increase in its prices and sudden depreciation of Euro and Pound in the wake of Brexit.
He said that due to 34% sharp decline in cotton production this year, its prices have also recorded an upward trend in local as well as in the international market. He said that despite of the gravity of the situation, the government has not yet taken any remedial steps to compensate the value added textile sector. Increase in cotton prices was the natural outcome of the low cotton yield; he said and added that it has further enhanced our cost of doing business which was already a major problem for the exporters in competing with their arch-rivals.
He suggested that government immediately withdraw 15% Regulatory Duty on the import of yarn and duties on cotton to ensure free availability of raw material to the value added export sector enabling it to compete with regional competitors and maintain its position in the international market. Similarly, in view of acute shortage of cotton in the domestic market the Government should immediately impose completely ban on export of cotton and yarn to ensure availability of raw material in abundance to the value added textile sector.
Continuing Dr Khurram said that steep decline in the value of Euro and Pound after Brexit is yet another factor that has badly affected the textile exporters. The depreciation of Euro and Pound is more than the proportionate profit of the exporters hence the business of exports particularly to UK and EU has become unviable. He said that India has already downward adjusted its currency to remain competitive in these markets. On the same line Pakistan should also adjust its currency in Dollar terms. If it is not possible than Government must sanction additional duty drawback to compensate its exporters enabling them to achieve exports target set by the ministry of commerce for the next three years; he concluded.