From Mian Rashid Asghar
FAISALABAD: Textile Exporters have stressed for continuation of Duty Drawback of Taxes incentive to continue the growth momentum in exports and uplift the economy. Textile sector is capable of harnessing US$ 25 billion for the economy which can prove to be a major boon for Pakistan’s debilitating economic situation.
In a statement, here on Monday, Chairman Pakistan Textile Exporters Association (PTEA) Sohail Pasha termed growth in textile exports as a boon for country’s economy. Country’s economic outlook looks strong for 2022 as it has posted a growth of 5.37% in FY 2021, substantially higher than the previous two years. Several indicators reveal that our economy has done well in spite of the Covid-19 pandemic setbacks, with year-on-year improvements in key indices. Textile sector, which is among the significant contributors, has played a significant part in this regard, he added. Textile industry has now picked up a growing pace following the removal of Covid-19 restrictions witnessing a sharp surge of 26% year-on-year to $ 9.38 billion in the first half of FY 2022. Higher textile exports came on the back of quantum growth in high value-added products. Pakistan still needs to increase private investment and enhance export volume to sustain strong economic growth. He described that in order to gear up textile exports, Duty Drawback of Taxes (DDT) incentive was allowed to textile exporters based on their exports which resulted in significant growth in textile exports. He underlined the need of continuity of drawback of local taxes scheme to sustain the growth momentum. The sector not only provides large scale jobs but also has a huge share in the exports of the country coupled with a magnanimous room for value-added textile products.
Highlighting the major initiatives of the Government to boost exports, PTEA Chairman said that the initiative to provide energy resources to export oriented industries at regionally competitive prices (Electricity @ 9 cent/kwh and Gas @ $6.5 per MMBtu) brought positive outcomes registering upward growth in exports. However, he stressed to ensure continuous energy supply at regionally competitive prices to export sector. Considering energy package as not a subsidy, he demanded to conduct Cost-of-Service Study and set tariffs accordingly. Pointing out liquidity issue, he said that Government has taken exemplary initiatives to streamline the refund process; however, old outstanding refunds (around 365 billion rupees in sales tax, Duty Drawback and income tax refund regime; whereas 85 billion rupees under textile policy incentives i.e DLTL, TUF & mark-up Support scheme) are still outstanding. He urged the Government for immediate disbursement of old outstanding refunds to steam up the industrialization and boost exports. He was of the view that to get benefit from the economic potential that lies in the textile sector, a number of curated policy measures have to be taken that can support the sustainable growth of the textile industry. Declining share of China in the US apparel market and shifting focus from apparel to global textile market had already created room for Pakistan and other competitors to enhance their shares in apparel exports. In order to reap the emerging global opportunities, Government must come up with comprehensive measures.
He concluded that textile industry, which comprises 46 percent of the total manufacturing sector, provides employment to around 25 million Pakistanis, contributes 8.5 percent to the GDP, is the industry that can lead Pakistan towards economic prosperity. A sustainable and inclusive economic growth is the key to a strong and vibrant Pakistan, which can open the door for development and prosperity.
