DLTL exchange rate revision to delay refunds: Prgmea

KARACHI: The Pakistan Readymade Garment Manufacturers and Exporters Association (Prgmea) has criticised the revision of exchange rate for the calculation of Drawback of Local Taxes and Levy (DLTL), saying that it will delay the refunds of textile industry.

In a statement issued on Tuesday, Shaikh Mohammad Shafiq, Central Chairman of Prgmea, said that the State Bank of Pakistan (SBP) has revised the calculation of exchange rate for the disbursement against claims of DLTL filed by exporters.  “The revision in DLTL scheme will delay the payment of refunds, while the textile industry was already facing crisis and needs financial support on an urgent basis without any further delay,” he said.

The new method will result in unnecessary reprocessing and re-scrutiny of claims at all levels, wasting precious times. It also gives the impression that the government is not serious in payment.

At a time when full payment is due and exporters have submitted their final claims after a lengthy process of paperwork revise calculation, this creates panic among the exporters, as it leads to minimise the numbers of the beneficiaries, as well as reduce their claim amount up to 20 percent.

“The SBP’s recent circular will further damage the export-oriented sectors,” he added.

In the Budget 2015/16, the government has committed to release refunds of DLTL claims to the exporters, but the recent circular of the SBP gives impression that it would not seem to be materialised like several other commitments of the government, he said.

The Prgmea chairman criticised the government for closing eyes to put glance towards the difficulties of the value-added exporters who is a major employment generated sector of the country, which have set a bad effect on exports and that is why most of the exporters are shifting their units in neighbouring countries where the governments give them feasible incentives.