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Pakistan's FM announces Textiles Package in Budget 2014-15
04
Jun '14
Pakistan’s Finance Minister Ishaq Dar has announced a special Textiles Package in Budget 2014-15. 
 
In his Budget speech, Mr. Dar said the textiles industry is central to economic development of the country, and hence the Government has decided to give impetus to its development, and also to meet the special needs of exports.
 
“Textiles sector is the mainstay of country’s exports as it accounts for more than half of country’s exports. Its performance has been affected due to poor crops, delays in introduction of quality seeds and regulatory approvals for introduction of Bt cotton, widespread energy shortages, numerous local taxes and levies, high cost of finance and restricted trade regimes adopted by importing countries,” Mr. Dar said.
 
“A meaningful export promotion policy will not be possible unless we provide the much-needed support for the development of this sector,” he added.
 
As per the package, the draw-back for local taxes and levies will be given to exporters of textile products on FOB values of their enhanced exports if increased beyond 10% (over last year’s exports) at the following rates: 4% for garments, 2% for made-ups and 1% for processed fabric.
 
The Budget proposes to reduce the Mark up rate for Export Refinance Scheme of State Bank of Pakistan from 9.4% to 7.5% from July 1, 2014. 
 
“The Expeditious Refund System is being improved and a fast track channel for manufacturers-cum-exporters is being created. I have already directed FBR to dispose of all their pending Sales Tax refund claims before September 30, 2014. In future, all admissible refund claims of exporters shall be disposed off within 3 months, if not earlier,” Mr. Dar said.
 
To provide a predictable tariff regime for the foreseeable future, the textile sector value chain will be given protection as per the study carried out by National Tariff Commission (NTC).
 
For technology upgradation, textile industry units in the value added sector would be provided Long Term Financing Facility (LTFF) from State Bank of Pakistan at the rate of 9% for 3-10 years duration.
 
The duty free import of machinery under textile policy 2009-14, which ends on June 30, 2014, will be extended for another two years to take full advantage of GSP Plus facility.
 
The Government will promote use of Bt cotton by expediting regulatory approvals. To enable availability of quality seeds requisite amendments in Seed Act 1976 will be made and Plant Breeders’ Right Act will be promulgated.
 

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Courtesy: India ITME

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