PTEA expresses concern over unending fall in exports

High costs, inconsistent policies, uncompetitive energy prices reasons for decline

FAISALABAD: The Pakistan Textile Exporters Association (PTEA) has expressed grave concern over the sluggish growth in exports as unending export downfall has continued unabated.

High costs of production, competitiveness, inconsistency in government policies and uncompetitive energy prices have contributed to the deteriorating exports.

PTEA Chairman Mian Ajmal Farooq said that the economy’s mainstay textile industry is facing unprecedented crisis for many years. Consequently, sizeable textile capacity has been severely impaired and textile exports, both in quantity and value terms, have declined across the value chain; whereas regional peers have doubled their exports.



Giving details, Farooq said that the country’s textile exports were $13.8 billion in 2010-11, which has dropped by 10.4% to $12.4 billion in 2016-17. On the other hand, textile exports of India witnessed 31% increase from $ 27.7 billion in 2010-11 to $36.4 billion in 2016-17.

“Unfortunately, the government is not feeling the pain of the fall in export earnings as sliding exports are contributing significantly to the trade deficit,” said the chairman.

Citing reasons for the erosion of the textile industry, he said that competitiveness was a major factor behind the downfall, particularly against the huge incentives being provided by the competing countries to their export sectors.

Extreme cash flow crunch and high energy prices have caused major dent to country’s exports rendering the sector unable to tap its potential in accordance with its capacity. Farooq lamented that PTEA has been sensitising the government for reducing the cost of doing business to extend a helping hand to export sectors through supply of energy at comparative prices vis-a-vis regional peers and removing the effects of severe cash flow crunch but no heed was paid towards the challenges.



In order to support the struggling industry, the government announced a textile package, under which incentives were offered for six months that have now expired. He demanded to continue the drawback of taxes incentive scheme, and immediate payment of outstanding refund claims stuck up in refund regime from years.

Published in The Express Tribune, August 18^th, 2017.

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