Chairman NA body threatens resignation on textile woes

KARACHI: Chairman Standing Committee of the National Assembly on Textile Khawaja Ghulam Rasool Koreja threatened to resign if the government would fail to resolve the issues facing the industry.

Koreja, talking to the office bearers of the Pakistan Hosiery Manufacturers Association (PHMA) on Wednesday, said the committee will call officials of finance and commerce ministries as well as the Federal Board of Revenue (FBR) to discuss the matters especially related to sales tax refunds.

The committee’s chief, heading a 19-member delegation, assured the representatives of the value-added sector of solving their problems. 

He said the committee will also hold a meeting with the Prime Minister and Finance Minister for apprising them of the sensitivity of issues. He identified four issues pertaining to value-added textile sector, including refunds, export development fund, new markets and cost of production.

The chairman also constituted a sub-committee to discuss the difficulties with other representatives of the value-added sector.

Committee member Abdul Rashid Godil said sales tax threshold should be eliminated and a reduced and uniform rate be introduced.

Godil said that he had raised voice for the important sector but it appeared that the government was more focusing on trading instead of manufacturing.

He said sales tax refunds are working capital of textile industry, which should immediately be paid. He also said the committee will propose a mechanism under which the tax authorities do not need to collect taxes to make refunds at the later stage.

Another member Shafqat Hayat Khan said the committee can only recommend the proposals to the government. Khan said the utility charges in Pakistan should be brought at par with those in regional countries to make the local export industry competitive in the global markets.

A committee member Akram Ansari said the government is not considering the contributions made by the sector towards the national GDP. 

Ansari said there is need to identify factors to make the local products competitive in the international markets.

Another member Romina Khurshid, however, said the committee is powerful enough to get the proposals approved. Khurshid said difficulties faced by the value-added sectors would be pursued at all the government forums until they are resolved.

Chief Coordinator Jawed Bilwani at PHMA said though the standing committee raised the voice about revival of zero-rate sales tax regime, yet the government didn’t pay heeds.

Bilwani said value-added sector had intimated the government about the falling exports, but the government did not take it seriously. He attributed the decreasing exports to higher utility prices and uncompetitiveness in the international markets.

He said Pakistan’s exports grew to $23.8 billion from $4.9 billion during the last 25 years, while Bangladesh’s exports rose to $30.1 billion from $1.6 billion and India to $310.3 billion from $16.6 billion in the same period.

He said the government failed to promote the sector as there is no textile minister in the country.

Bilwani said the textile exports contributed around $13.47 billion to the total exports of $23.8 billion. The share of value-added sector in textile export is $11.4 billion.

He warned that Pakistan would no more be a textile exporting country considering the present situation.

He added that stuck sales tax-refund is one of the major issues and proposed no payment and no refund mechanism.