APTMA, PRGMEA at row over cotton yarn imports from India

04 Mar '14

2 min read

Pakistan Readymade Garment Exporters Association (PRGMEA), the representative body of value-added textile industry, has condemned the textile spinning sector of Pakistan for its dual standards on ‘free market economy mechanism’.

In a written request to Textile Secretary Rukhsana Shah, All Pakistan Textile Mills Association (APTMA) Central Chairman Yasin Siddiq had sought imposition of a minimum 5 percent duty on cotton yarn imports from India, as these are priced 15-20 percent lower than local market. Subsequently, the Ministry of Textile Industry invited views of the value-added textile industry.

Ijaz Khokhar, Chief Coordinator and Former Chairman of PRGMEA, said while the country was facing shortage of cotton yarn, APTMA rejected the value-added textile industry’s plea of banning yarn exports, saying it would be intervention of free market mechanism. However, now as global yarn prices are on a fall, the spinners intend to block imports and sell their produce in local market at higher prices.

Mr. Khokhar said that stringent import policies would restrain raw material availability, and Pakistani garment industry would not be able to fully benefit from the duty-free access to the EU under GSP. He thus urged the Government to continue with the existing zero-rated yarn import policy from India.

In his letter, Mr. Siddiq mentioned that India accounts for 78 percent of all cotton yarn imported by Pakistan, and urged the Government to end the zero-rated status that Indian cotton yarn is enjoying in Pakistan since 2010.

Last month, Mr. Siddiq sounded caution over the Government’s proposal of raising sales tax on textile industry from the existing 2 percent to 5 percent in the first phase and again to 17 percent over the next three years.

Apprehending that the Federal Board of Revenue (FBR) may fail to timely process all the refund claims, he warned that any hike in sales tax would lead to a liquidity crunch situation and restrain the industry from achieving expected growth in exports to EU under the GSP.

Fibre2fashion News Desk - India

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