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February 8, 2015

Textile sector demands withdrawal of tax on yarn

Business

 
February 8, 2015

KARACHI: The value-added textile sector has urged the government to withdraw five percent additional duty on import of cotton yarn in order to protect the sector from further losses, a statement said on Saturday.
Business leaders, in a conference on Friday, said the spinning mills are making profits, as is evident from their balance-sheets, and there have been no reports of any closure, while the value-added textile industry has suffered losses and several companies have closed operations because of high costs.
“If the running cost, especially the price of raw material declined then exporters will be able to get orders from foreign buyers,” said Javed Bilwani of Pakistan Apparel Forum.
Exporters who participated in Heimtextil and Texworld, international textile trade fairs, bagged considerable orders, but the costs of operations have increased because of the import duty.
The speakers said the duty should actually be imposed on export of cotton yarn.
“If government desires to continue the import duty, then it should be imposed on export of cotton yarn, as well.”
Bilwani said all over the world export of raw material has greatly been discouraged and restricted, while import of raw material had always been allowed, just because of value addition and earning of foreign exchange. “In contrast, the government has allowed export of essential raw material for value addition.”