PRGMEA concerned over transfer of garment business to Bangladesh

13 Jul '11

2 min read

Spokesman of Pakistan Readymade Garments Manufacturers & Exporters Association (PRGMEA) has expressed concern over transfer of woven garment business to Bangladesh and urged the government to take measures in order to discourage this trend.

He said a good number of Pakistani woven garment manufacturers and exporters are studying the Bangladesh market while a few have already established businesses there. He said the pro-industry policies in Bangladesh are prime reason behind the attraction for Pakistanis besides the trade concessions from the West.

PRGMEA spokesman said Bangladesh was providing 11% drawback on export of readymade garments to its exporters. Not only Bangladesh, he added, other competing countries including China and India were offering heavy drawbacks to their woven garment industry. He said China is offering its exporters export rebate at 17% on various garment items. In 2010, China's export tax rebates totaled 732.7 billion Yuan ($113.3 billion), registering an increase of 13% from the previous year and equivalent to the total expenditures education, social welfare and subsidized housing sectors.

In India, said the PRGMEA spokesman, the drawback rate for cotton garments is 7.5% as against the earlier rate of 8.8%. Also, for blended garments of cotton and MMF, the new drawback rate is 8.6% as against the earlier rate of 9.8% and the new drawback rate for garments of MMF is 9.5% as against the earlier rate of 10.5%.

He deplored that Pakistan government, on the other hand, has withheld Drawback of Local Taxes and Levis (DLTL) scheme from July 2011 onwards, putting the future of woven garment industry into doldrums amidst unprecedented inflationary pressure. He said that the DLTL scheme is vital for the survival of exporting units in a situation when Pakistan is passing through double digit inflation besides ongoing unprecedented energy crisis.

Spokesman PRGMEA has urged the Ministry of Textile, Ministry of Finance and Chairman Federal Board of Revenue to act immediately and resume the DLTL scheme to encourage the woven garment exporters to continue with their businesses in Pakistan. He said the DLTL scheme has played vital role in boosting textile exports to the historic level of $14 billion in 2010-11besides employing 45 percent of the total workforce in the country.

Pakistan Readymade Garments Manufacturers & Exporters Association (PRGMEA)

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