Exporters welcome duty withdrawal on cotton, yarn import

Exporters welcome duty withdrawal on cotton, yarn import

KARACHI: Value-added textile exporters have welcomed the decision of the Economic Coordination Committee (ECC) of the cabinet to remove customs duty on import of cotton and yarn.

Value-Added Textile Exporters convey sincere gratitude and thanks to Prime Minister Imran Khan, Adviser Commerce Razak Dawood and Federal Cabinet on the ECC for according genuine consideration to the demand of Value Added Textile Export Sector to allow duty free import of cotton yarn till June 30, 2021 which exporters were demanding since October 2020 due to unavailability of cotton yarn in the local market.

The belated decision, however, shall provide only partial relief in the wake of sea trade congestion as the shipments are taking more than two months time to reach Pakistani ports.

Therefore, textile exporters are of the opinion and appeal the Government to allow duty free import of cotton yarn till time the government achieves its set cotton production target of 10.5 million bales.

To ease down the cotton yarn availability crisis, it is also imperative that to also place ban on export of cotton yarn from Pakistan or impose 10 percent duty on export of cotton yarn from Pakistan and take necessary steps and measures to import cotton yarn safely from Central Asian Republics through land route by activating all the transit trade agreements signed with regional countries as the sea route is taking prolong duration due to shortage of containers and vessels.

The textile exporters once again request the Government to take cognizance over hoarding of cotton yarn and cartelization by concerned which are actionable as per law under the Price Control and Prevention of Profiteering & Hoarding Act 1977 and Competition Act of Pakistan 2010.

According to the said Act of 1977 cotton yarn is included in the schedule of essential commodities like sugar, wheat, edible oil etc. Therefore, the Government must immediately take action as per the law against spinning mills and yarn traders involved in monopoly, abusive dominance for exorbitant pricing and hoarding and immediately conduct raids by arresting the culprits and seize the hoarded cotton yarn and also conduct Forensic Audit on the pattern of sugar crisis that will prove it many times bigger scam than the sugar scam as it is learned that approx. 2 million bales have been sold without sales tax and invoices in the local market.

This joint statement was issued by the Value Added Textile Sector Associations: Jawed Bilwani, Chairman, Pakistan Apparel Forum, Waheed Khaliq Ramay of Power Looms Owners Association, Ijaz Khokhar, Chief Coordinator & Ex-Central Chairman, Pakistan Readymade Garment Manufacturers & Exporter Association, Riaz Ahmed, Central Chairman Mian Farrukh Iqbal, Senior Vice Chairman, Pakistan Hosiery Manufacturers & Exporters Association, Syed Aasim Shah, Former Chairman, All Pakistan Bedsheets & Upholstery Manufacturers Association, Rafiq Godil Chairman, Former Chairman, Pakistan Knitwear & Sweaters Exporters Association, Dr. Shahzad Arshad, Chairman, Pakistan Cotton Fashion Apparels Mfrs. & Exporters Association, Aamir Lari, Vice Chairman, Towel Manufacturers Association of Pakistan, Abdus Samad, Chairman, Pakistan Cloth Merchants’ Association.

In another statement Hanif Lakhany, Vice President, Federation of Pakistan Chambers of Commerce & Industry (FPCCI) & Senior Vice Chairman Pakistan Yarn Merchants Association(PYMA) and Vice Chairman Farhan Ashrafi & convener FPCCI’s Central Standing Committee on Yarn Trading, have lauded ECC decision to withdraw customs duty on cotton yarns, and said that ECC of the Cabinet withdrew customs duty on import of cotton yarns under PCT 5205, 5206 and 5207 till 30th June, 2021.

However, both officials called for the abolition of additional customs duties & regulatory duty on synthetic yarns for countering the negative effects of the Corona epidemic and to continue the production activities. They also reiterated demand to allow import cotton & cotton yarn from India

In a statement, Hanif Lakhany & Farhan Ashrafi said the ECC was commendable but the removal of additional customs duty & regulatory duty on synthetic yarns should also be abolished to support the textile industry, which is facing hurdles due to unavailability of raw materials and high prices. So immediate permission should be given for cotton & cotton yarn import from India.

“Due to low production of cotton in the country and huge increase in the price of cotton yarn in the local market, the cost of industrial production has gone up significantly. On the contrary, it is becoming more and more difficult to run industries, which may affect the delivery of export orders”, they pointed out.

Hanif Lakhany and Farhan Ashrafi requested the government to allow import of cotton & cotton yarn from India in the best interest of the economy to ensure timely fulfilment of export orders. Which will be warmly welcomed by the business and industrial community across the country.