Regulatory duty on cotton import withdrawn

Regulatory duty on cotton import withdrawn

ISLAMABAD: The government has withdrawn 3 percent regulatory duty on import of cotton, a notification said on Tuesday.

Federal Board of Revenue (FBR) issued SRO 38(I)/2020 to withdraw 3 percent regulatory duty on import of cotton.

Through SRO 949(I)/2019 the regulatory duty was imposed on import of cotton.

The regulatory duty was imposed on August 22, 2019, after unfavorable weather conditions, particularly prolonged hot and dry weather conditions, coupled with massive attacks of whitefly, pink bollworm, and other pests/insects gave cotton crop heavy battering.

Moreover, growers are increasingly losing interest in planting cotton because they are not getting any returns or profits as the production cost is rising and the market prices are falling.

The latest withdrawal of regulatory duty was granted in pursuance to approval by Economic Coordination Committee (ECC) of Cabinet earlier this month.

Last year on October 4, the Cotton Crop Assessment Committee projected that cotton production at the end of the year would be 10.20 million bales as against the target of 15 million bales for the fiscal year 2019-2020.

In order to fill the gap, the commerce division had proposed duty-free import of cotton.

But the ECC was informed that bulk of cotton would be lifted from local farmers by January 1 this year and the proposed exemption would not adversely affect the interests of local farmers.

Both the commerce and national food divisions gave assurance that imported cotton would facilitate textile exports which are showing an upward trend.

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