The Ministry of Textile Industry has claimed that the decline in textile exports would be arrested due to the Rs 15 billion released under the Prime Minister incentives’ package for textile exporters.
According to the Ministry data, textile and clothing exports rose by 6.2 percent to $1.064 billion in March 2017 compared to $995.33 million in Feb 2017. However textile exports during July-April 2017 were $10.297 billion against $10.392 billion in July-April 2015-16, registering negative one (-1) percent growth.
Textile exports were -7.34 percent during the first ten months (July-April) 2015-16. The Ministry is projecting positive growth in textile exports by the end of the current fiscal year. Talking to Business Recorder Textile Ministry spokesperson Kanwar Usman said that latest export figures are encouraging and suggest that the government’s initiatives to boost textile exports have started showing positive results.
Usman said that government announced four major incentives for the textile sector under the PM package that include: (i) drawbacks available to garments at 7 percent, made-ups at 6 percent, processed fabrics at 5 percent and yarn and greige fabric at 4 percent; (ii) bringing custom duty and sales tax to zero rate on cotton import; (iii) zero rate sales tax on machinery import; and (iv) abolishing customs duty on man-made fibres other than polyester.
Under the drawbacks facilities, exporters submitted claims of Rs 3.2 billion by May 15, while government has released Rs 1 billion so far. Usman said that a request has been sent to Finance Ministry for release of more funds to accommodate exporters’ claims. The country imported 82,000 bales of cotton in December 2016-17 compared to 475,000 bales in December 2015-16 (-82 percent), 225,000 bales in January 2016-17 compared to 335,276 bales in January 2015-16 (-36 percent), 421,388 bales in February 2016-17 against 326,470 bales in February 2015-16 (29 percent), 530,882 bales in March 2016-17 against 257,252 bales in March 2015-16 (106 percent) and 481,300 bales in April 2016-17 against 251,541 bales in April 2015-16 (91 percent).
Data suggests that exporters were given incentives of around Rs 8 billion on account of cotton imports as it was brought to zero rate from 9 percent under the PM package. According to Economic Survey textile machinery import registered an increase of 20.8 percent ($401.1million) during July-March fiscal year 2017 against ($332.1 million) the same period last year suggesting increased activity in the textile sector which is a healthy sign and will give fruit in future.
Textile Ministry spokesperson said that textile machinery worth $250 million was imported after the PM package which indicates exporters were given tax concessions amounting to around Rs 2.5 billion. The exporters have benefited to the tune of around Rs 800 million after the implementation of PM package as customs duty on man-made fibres other than polyester has been abolished.
Pakistan Bureau of Statistics latest data shows that textile and clothing exports fell 0.92 percent year-on-year to $10.29 billion in July-April. Product-wise details show exports of readymade garments rose by 5.34 percent while those of knitwear dropped 0.17 percent in July-April. Exports of bed-wear edged up 5.01percent while those of towels fall 4.38 percent. Exports of cotton yarn witnessed a year-on-year decline of 3.68 percent while those of cotton cloth and yarn (other than cotton) declined 5.73 percent and 29.48 percent, respectively.-Business Recorder