PAF strongly opposes to current 5pc import duty on cotton yarn

The Pakistan Apparel Forum (PAF) members said on Thursday said that the value added textile sector is burdened due to the current 5 percent duty on the import of cotton yarn and the industries are on verge of collapse, hence the government should withdraw duty on the import of cotton yarn help the value added textile sector enhance its exports.

The demand of textile spinning sector for imposition of 25% regulatory duty on import of cotton yarn is detrimental to the entire value added sector. According to the PAF members, the government should not accept un-due demand, as the spinning sector does not represent the entire textile sector. The major stakeholders in the value added textile sector should be taken on board before any crucial decision.

PAF Chairman Jawed Bilwani said the textile sector was burdened with multiple taxes with high cost of inputs-tariff of gas, electricity, water and raw material and was further harassed due to short supply of all essential utilities.

The forum has urged the government to make a policy for reduction in all cost of inputs for five export-oriented sectors, as otherwise all export-oriented industries would be dented.

In 2010, many of the spinning mills claimed that they had made record profits and even at that time, several spinning mills showed losses either because they were inefficient or they were showing losses so that they did not have to pay dividends to the shareholders. The government should investigate this matter thoroughly that what such spinning mills were doing or were they taking their shareholders for a ride.

He expressed reservations against demand of the spinning sector, which would cause closing down of thousands of medium and large scale value added textile sector units in the country.

The performance of value addition by woven garments sector is 846%, hosiery/knit garments 616% while the spinning sector stands at a mere 59%.

The government should make all efforts to bring the cost of inputs of five export oriented sectors in comparison to regional competitors to enable them compete in the global market.