Trade Chronicle Sep-Oct 2015

TRADE CHRONICLE
We begin with the name of Allah, the Magnificient
Textile package:
A ray of hope for the non-value added sector
From
Editor's
Desk
Pakistan Textile Industry is not only catering the local demands
but also ranked backbone of country’s export portfolio. It has
an overwhelming impact on the economy, contributing 57% to
the country’s exports. Its performance is vulnerable to internal
and external factors. To protect local industry from competition,
dumping, cheap import and to justify demands of non-value
added sector and value addition sector – is always a challenging
job for the successive governments and this could further be
aggravated when there are eleven associations, representing
different sectors right from basic textile to the value added sector.
A classic example of the issue was surfaced when Mian
Muhammad Nawaz Sharif, Prime Minister of Pakistan
announced partial textile package for the non value added
sector recently. All Pakistan Textile Mills Association (APTMA)
has acknowledged Govt. incentives and publicly said the
measures will safeguard domestic market for the textile industry
of Pakistan. Textile Industry is hopeful that rest of the eight
demands will soon be considered favourably and resolved by
the Government for the viability of Industry and Increasing
Exports of the Country.
But the value-added textile sector has slammed the imposition
of 10 per cent Regulatory Duty (R/D) on import of cotton yarn
and fabric from India on the grounds that a case of anti-dumping
filed by spinners’ body is already pending before the National
Tariff Commission (NTC). The leaders of associations of hosiery,
readymade garments, knitwear and sweaters, cotton fashion
apparel, etc pointed out that since the NTC was hearing a case
of anti-dumping against Indian cotton and yarn, the government
could not unilaterally take a decision of imposing 10pc R/D.
ABDUL RAB SIDDIQI
Thus it was govt.’s obligation that it should have taken on
board the value addition sector of textile or sought comments
from NTC to avoid their suffering and hence provided level
playing field to all manufacturers. The value addition fetches
good export revenus as well as provides a lot of employment
opportunities. Any haste decision in this regard can deprive
same. A point to be considered always.
A local research house pointed out that the much awaited textile
package was formally announced by the government on 17th
Oct’15 wherein the government announced i) 10% regulatory
duty on the import of Indian yarn and grey fabric, in addition
to the 5% custom duty already in place ii) 1pps cut in Long
Term Finance Facility (5% from 6%) and iii) 1pps cut in Export
Refinance Facility (3.5% from 4.5%). Following the imposition
Trade Chronicle - September - October 2015 - Page # 04