Exporters for continuing lower energy tariffs
Power. PHOTO: FILE
Textile exporters have demanded the continuation of concessionary energy tariffs for the export industry.
“Any imprudent and unwise decision of the government to discontinue the concessionary power tariff for the five export-oriented sectors will be disastrous, damaging the struggle of exporters to enhance exports,” said Pakistan Hosiery Manufacturers and Exporters Association (PHMA) Central Chairman Shahzad Azam Khan in a statement.
PHMA Chief Coordinator Jawed Bilwani said that textile exports were on top as they fetched $15.4 billion in 2020-21, which “are now going to surpass $15.98 billion in just 10 months of 2021-22 with a notable increase of 25%”.
He noted that the knitwear sub-sector in the textile group achieved the highest growth in exports, as its exports rose from $3.8 billion in 2020-21 to $4.2 billion in 2021-22 (10 months) with 35% growth.
“Demand has already been impacted by the hike in commodity prices in both domestic and international markets,” Saad Ziker, textile sector analyst at Topline Securities, told The Express Tribune.
If energy tariffs are revised, the industries may be impacted by higher fuel costs, which will result in lower earnings. “Not only tariff should be lower, the textile sector should also get uninterrupted supply of energy to meet the orders on time,” he said.
AHL Head of Research Tahir Abbas said that the government should announce a clear economic roadmap along with key measures to boost exports.
“The only solution to the balance of payments crisis, which occurs after every three to four years, is sustainable and diversified exports along with focus on remittances,” said the research head.
Read Revised import control plan devised
The exporters said that they were willing to make all-out efforts to further enhance value-added textile exports to support the government and tackle the economic turmoil by earning more foreign exchange.
However, they cautioned the government that it should desist from any unwise move, which may sabotage the hard efforts of the exporters to enhance exports.
They asked the prime minister and his economic team to ensure a level playing field by offering concessionary energy tariffs and continuing the Duty Drawback of Local Taxes and Levies scheme, as committed in the new five-year textile and apparel policy.
Zonal Vice Chairman (North) Kashif Zia urged the government to continue supporting the five export-oriented sectors for the sake of economic stability, employment creation and revenue generation.
Shahzad Azam Khan said that the value-added textile exporters wanted the continuation of grants by the government to ensure a level playing field and help the exporting industries compete with regional countries.
“In fact the industries are burdened and cross-subsidised in gas tariffs to give subsidy to the fertiliser and domestic sectors.”
Published in The Express Tribune, May 20th, 2022.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.