‘No economic stability without focus on exports sector’

LAHORE: The Pakistan Tanners Association (PTA) has said that no economic stability is foreseeable if it is without the consideration of the country’s exports sector.

After an emergent meeting of the leather sector, the PTA called upon to consider the worst-ever decline in exports recorded in the last 25 years.

"Leather had never faced such a steep fall in exports in the history." The PTA urged Prime Minister Nawaz Sharif as leader of the business community for attending SOS message from leather exporters and come for the rescue.

The Ministry of Finance and Economic Affairs is on the move for finalising proposals for the upcoming federal budget and it should consider the PTA proposals to arrest decline in leather exports, which is 27 percent down already in terms of value of goods exported in July-March last year, the PTA chairman said.

Agha Saiddain, former chairman of the PTA, said that during the last three years, Pakistan lost 42 percent in terms of quantity of leather exported.

"Pakistani leather is considered as the world’s best leather even better than India, Bangladesh and other countries and we have the best leather technology available in the country."

Saiddain stressed on the government to take measures to provide level-playing field for leather manufacturers-cum-exporters.

He said that a recent delegation from Pakistan comprising, inter-alia, the high ranked officers from the Ministry of Commerce, during its tour to India in December 2015 witnessed the flourishing of the Indian leather sector with the patronage of the government of India.

Anjum Zafar, chairman of Duty Drawback Committee of the PTA, said that Pakistani leather exporters are facing problems due to nonpayment of refunds (sales tax, duty drawback) for the last two years.

"No benefits, but we want our money refunded. Presently, Punjab leather industry has more than Rs250 million stuck up on account of sales tax and duty drawback refunds."

He said that the government of Pakistan, at large, has failed to account for the genuine needs of the leather exporting sector; therefore, Pakistani leather exporters stand nowhere in the global outset.

"After 2010 till 2015, our regional competitors such as Bangladesh outperformed in the same regime and its leather exports boosted 105 percent, whereas India and China posted a parallel increase of 63 percent and 19 percent in the same period.

Pakistani exports are on the decline for which Zafar held the government policies responsible.

Besides inflation, local taxes are adding up 12 to 14 percent to the cost of exports; hence, "we are getting out of business internationally”.

Evidently, there is no consideration for exporters at the Federal Board of Revenue (FBR) offices.

The government should bring comprehensive reforms in the tax refund system so that no refunds of exporters should remain stuck up anymore, Anjum said.

The PTA (Northern Zone) chairman appealed to the prime minister to call an emergent meeting with the leather sector stakeholders in order to build up a deep insight on the worsening affairs and to take measures for improvement.

He said that a comprehensive letter was already awaiting prime minister's consent and consideration.