Pak textile bodies seek ban on cotton & yarn exports

18 Jan '12

3 min read

Several textile associations in Pakistan have urged the Government to either ban raw cotton and coarse yarn exports from the country or levy a 15 percent duty on their exports, so as to safeguard the domestic textile industry against rising cost of doing business and competition.

All Pakistan Textile Mills Association's (APTMA) representative Yasin Siddik, Pakistan Apparel Forum's (PAF) Jawed Bilwani, Pakistan Towel Manufacturers Association's (PTMA) Feroze Azam and Karachi Cotton Association's (KCA) Shakeel Ahmad made the plea, while highlighting the continuous decline in exports of value-added textile items from the country.

The associations noted that cost of doing business for the value-added textile industry has increased, as exports have led to shortage of raw cotton, cotton yarn and polyester fibre, the basic raw materials used by the domestic value-added textile industry.

Hence, the textile bodies demanded that the Government introduce a levy of 15 percent duty on export of raw cotton and coarse yarn or ban exports of the same.

Mr. Ahmad said that even while retaining high-quality, Pakistan's cotton and coarse yarn are still cheaper than those from other countries. He added that the Government is acting biased towards the ginning sector and it is neglecting the interests of the country's biggest employment and foreign exchange generating value-added textile industry.

While the domestic value-added industries use around 75 percent of the local yarn, the remaining 25 percent is exported to countries like Thailand, Bangladesh, China, India, Indonesia and Sri Lanka, he said.

He added that intervention of the Ministry of Textile and Ministry of Commerce in the free textile trade regime would negatively affect country's value-added exports.

The news of the Trading Corporation of Pakistan (TCP) stepping in as second buyer of cotton instigated a surge in domestic lint prices, but as the Ministry of Finance fell short to provide PK Rs. 26 billion to TCP for funding cotton purchases, this halted the trend of rising cotton prices.

As compared to last season, cotton cultivators in Pakistan are likely to earn around PK Rs. 200 billion more this season.

As against domestic spinning industry's annual requirements of 15.8 million bales (1 bale = 170 kg) of cotton, the country annually produces an average of 12.5 to 13 million bales.

Pakistan's value-added textile industry has an opportunity to enhance its garment exports, which has a better potential to fetch valuable foreign exchange for the country, Mr. Siddik said.

There are 415 spinning units functional in Pakistan, around 172 of which are functional in Kotri, Nooriabad Industrial Estate, Karachi and Hyderabad, he added.

In the absence of Government action to ban export of raw materials, the value-added textile industry is likely to loose a considerable number of export orders and suffer heavy losses. This would result in a loss of a large number of jobs in the domestic textile manufacturing industry, he said.

Mr. Azam stated that towel manufacturers' export quality towels prepared from domestic coarse yarn, but due to raw material shortages, the manufacturers are struggling to control their cost of production.

According to him, total exports of Pakistan's textile industry would grow by PK Rs. 900 million if the Ministries support the growth of the country's value-added sector.

Fibre2fashion News Desk - India

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