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Islamabad: The Federal Minister for Textile Industry Mr. Makhdoom Shahab Ud Din presided over a high level meeting here today. The agenda of the meeting was to consult the industry on three major issues which included decline in textiles exports, textiles policy implementation and ongoing negotiations on granting MFN status to India. The meeting was attended by representative of all major textiles associations and chambers of commerce and industries.
Secretary, Ministry of Textile Industry, Mr. Shahid Rashid shared the views of the Ministry on the agenda items. The Secretary, Ministry of Textile Industry briefed the participants on textile policy implementation.
He informed that Ministry has signed MOU with EOBI and Social Security Departments of Punjab and Sind to reimburse EOBI and Social Security of women and handicapped employees working in textiles sector from the date of commencement of Textiles Policy that is October 2009.
The Secretary also informed that in proposed Textiles Industry Development, Promotion and Standards Act, the clause pertaining to levy of cess has been modified. He also briefed on disbursements made to textiles sector in various schemes under Textiles Policy including recent-release of Rs. 2 billion for drawback of local taxes and levies.
The Bedwear Association was of the view that Export Refinance Rate which was 7.5% three years back has been increased to 11%. He further added that there is a need to reduce such rates as in economic recession countries, need extra efforts to get the business in presence of over capacities available. Mr. Javaid Bilwani of PHMA, expressed his concern about utilities availability, fluctuating utilities prices and recommended that textiles sector should be assured of utilities and fixed prices of utilities for the year.
He also said that if same quantities are exported then still there would be 33% reduction in export values due to lower cotton prices. He suggested that in gas management textiles sector should be placed at the same priority level with Urea. Mr Ejaz Khokar of PRGMEA was of the view that buying scenario has changed and due to EU economic crisis, exports proceeds have been delayed and there is a need to review the EFS time limits. Mr. Akbar representing APTMA was of the view that textiles sector should be given priority in gas management. Mr. Shahzad Saleem, Chairman Pakistan Ready Made Garment Association was of the view that efforts should be made on proactive basis to get the unilateral duty concessions by EU.
This would facilitate the industry specially in economic crisis. He also urged that Pakistan should actively lobby to get GSP plus in 2014. Pakistan Yarn Merchant Association requested the Government to fix minimum support price and urged Government to buy cotton through Trading Corporation of Pakistan. Moreover, Mr. Rafiq Godal, PAKSEAC, highlighted that due to current stiff competition, number of non performing loans in textiles sector have increased during this year.
He said that due to utilities availability problems the power setup costs have increased from 3% to 15%. He also suggested that diesel should be provided on duty free as 75% of SME industry has been using diesel generators.
He also mentioned the subsidies provided by the competitor Governments to their textiles sector. He also pointed out that Ministry of Finance only released Rs. 19.25 billion compared to Rs. Rs 123 billion as approved by the Cabinet under the Textile Policy for first three years.
During the meeting Mr. Khawaja Usman mentioned that local taxes and levies shall be suspended until Government does not release the required funding. The All Pakistan Bed Sheet and Upholstery Association recommended that Export Development Fund should be controlled by the Ministry of Textiles to the extent of contribution made by the textiles industry. This would facilitate the Ministry to take immediate measures as per the requirement.
He pointed out that textile sector has not been getting their share in EDF disbursements. On this occasion, the industry representatives recommended that the issue of gas load management, increase in textile industry’s NPLs and issues related to GSP+ and EU tariff package must be taken up on priority manner.
The industry also expressed concerns on the way MFN status to India is being handled. Chairman PRGMEA insisted that replacement of positive list with a negative list is not the way forward in this matter. Vice Chairman APTMA shared various tools which India is using as Non-Tariff Barriers against Pakistani exporters including banking transactions and not honouring of LCs of Pakistani Banks.
Minister, Makhdoom Shahab Ud Din appreciated the recommendations of the stakeholders. He ensured that the Ministry will take immediate actions on the recommendations of the industry. He indicated that issues pertaining to others such as SBP, Ministry of Petroleum and National Resources, Ministry of commerce will be taken up to seek a resolution. He said that in this context, a meeting of a representative delegation of the textile industry will also be arranged with the President of Pakistan.
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