Powerloom sector faces crisis due to multiple reasons

August 18, 2019

MULTAN: The powerloom industry is an important part of textile industry in Multan, but entire sector is facing crisis due to continuous inflation, increased rates of energy and gas and rupee...

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MULTAN: The powerloom industry is an important part of textile industry in Multan, but entire sector is facing crisis due to continuous inflation, increased rates of energy and gas and rupee depreciation, which has left the powerloom workers jobless, The News has learnt.

Sixty per cent powerlooms have been closed in Multan. The export of loom products has been reduced to 50pc depriving the country from heavy foreign exchange after failing to meet the cost of production, powerloom workers said. The local powerloom industry entertains export orders from United States, Germany, Middle East and Russian States.

The hot shawls, kitchen clothe items, Lungi and Romal are the products, which are popular in US, Germany and Middle East, but almost export has been suspended due to heavy taxes.

The increased taxes on import of yarn, regulatory duty and customs duty running as high as 17pc in February last are one of the reasons behind crises. The government imposed an overwhelming 36pc duty on polyester imports some months ago, making matters worse for the industrial sector.

At least 100,000 powerlooms are functioning in 40 localities in Multan while 500,000 workers are associated with the industry. The workers deliver work in three shifts in 24 hours a few months back, Now one shift has been closed due to increased power and gas tariffs, rendering the workers jobless.

Talking to The News, All Pakistan Powerloom Association president Khaliq Qandil Ansari said that heavy taxes and depreciation of rupee had reduced export.

The country had been involved in powerloom products’ exports worth $36 billion, he told.

The export had reduced to $22 billion in the PML-N rule, he added. It further went down to $15 billion in this regime, he lamented. Currently, the country was exporting loom products only worth $15 billion, he maintained.

He said that under the weight of such heavy taxes, it had become difficult to continue the powerloom operations. He said that ex-PM Nawaz Sharif had allocated 3.40pc funds for the relief of the industry, but the present government had abolished it, overburdening the entire sector, he infomed.

The government had increased power tariff from Rs 10 per electricity unit to Rs 24.5 per unit, which was beyond the cost of production and matchless to expenditures, he continued. The powerloom industry depends upon dying process for refining piece of cloth and the dying process was run on gas but the government had increased gas tariff to 186pc, he maintained.

He said that production cost, wages and rising taxes caught factory owners off guard as they now had to pay motor tax, professional tax, property tax, civil defense and social security fees, which heavily cut into profitability. By November 2018, factories began shutting down, a trend that was still ongoing, he told.

The powerloom workers complained on complex tax system, which had spread confusion among the illiterate workers, he added. The powerloom owners were ready to pay taxes but complex process was a key hurdle, he added.

Akram Ansari, who works in a powerloom unit at Sharifpura, said that the workers associated with the powerloom sector had started losing their jobs. A majority of powerloom workers did not know any other craft, he lamented. They have little knowledge where to go next, he added.

He said that even the workers who still had jobs were finding it impossible to make ends meet. They were penniless, deprived from bread and butter, and unable to get

groceries on credit, he continued.

They pay shopkeepers when they get money and many have had to sell their belongings to stay afloat, he maintained. Khaliq Qandil Ansari appealed to the government to announce a relief package for the dying powerloom industry.

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