Textile industry: Committee asks govt to curtail cost of production

Urges immediate lift of ban on new gas, electricity connections.

ISLAMABAD: The Senate Standing Committee on Textile Industry has asked the government to curtail the cost of production for textile products aimed at providing the industry with a level playing field to compete with other countries of the region.

The committee sought immediate actions to address issues being faced by the textile industry due to various policies and regulations.

The committee met with its chairman, Senator Mohsin Aziz, and recommended that the government must immediately lift ban on new gas and electricity connections for the textile industry besides provision of uninterrupted supply of those resources.

It further recommended zero rating on exports, clearance of pending refunds, strengthen domestic commerce, remove duties on man-made fiber (MMF) imports and introduce investment support schemes to the textile sector.

Earlier, All Pakistan Textile  Mills Association (Aptma) Chairman SM Tanveer gave a comprehensive presentation to the committee over how and why the textile industry is facing challenges while competing with regional countries and as a result dozens of textile units have been closed down over time.

Tanveer said the government has put a burden of Rs170 billion on the textile industry including Rs72 billion in the head of tariff rationalisation surcharge, Rs38 billion Gas infrastructure Development Cess and Rs60 billion innovative taxes on consumption/production and export.

He said that the export-oriented textile industry cannot sustain the burden of Rs170 billion in the form of taxes and surcharge. “Compared to this, our neighbouring countries give targeted subsidy to their textile industry,” he said.

He mentioned that the country’s textile industry has a potential to double its export from $13 billion to $26 billion if its cost of doing business is reduced, which will further provide 3.5 million additional employment opportunities in the country. He mentioned that textile export has declined by 2.65% per month during the last financial year.

“This industry is at the brink of total closure due to unviable investment environment amid high cost of doing business,” Tanveer said.

Published in The Express Tribune, July 31^st, 2015.

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