Prgmea demands early implementation of revised PM’s package

LAHORE: Pakistan Readymade Garments Manufacturers and Exporters Association (Prgmea) has called for speedy implementation of revised PM’s package for exporters for 2017/18 along with an aggressive marketing plan to enhance exports and get the maximum benefit of GSP Plus status.

Prgmea Senior Vice Chairman Sheikh Luqman Amin appealed the Finance Ministry to release the funds without any further delay, as more than 30 percent cash flow has been blocked since long in the shape of sales tax refund and Customs rebate, which is adversely damaging cash liquidity.

The ministry has not yet released the major amount of the previous Rs180 billion PM’s package to be processed from January 2017, he said, adding that the government should take steps for the removal of hurdles hindering textile sector exports. Moreover, in this situation of financial crunch the textile value-added products are unable to fetch a high value due to poor packaging.

He suggested under these circumstances there is also a need to set up a product and packaging centre. Amin said that the association has also decided to devise a long-term strategy in response to the lack of interest showed by the government.

The industry is competing in the global market without the support or a proper plan, while major competitors such as India and China are utilising all channels and resources.

The Prgmea chief suggested formulation of sector-wise policies can also control decline and stabilise exports. Due to the unavailability of the latest fabric locally, the garment sector currently has a limited product line for the exports market, he said, adding that foreign buyers are demanding new garments on G3, G4 and technical fabric raw material, which are not available nor produced by the Pakistani weavers.

Amin lamented that the value-added textile exporters are battling hard for their survival in the global market in the face of severe competition with the regional countries. Terming funds blockage as the main cause of continuous drop in exports, he said exports industry is unable to tap its potential in accordance with capacity.

The government initiative, if implemented timely, will surely provide relief to the exporters who are facing severe liquidity crunch, he added. The government had assured the exporters of simple procedure and paperless working, but in the new notification, the central bank has involved more paper working and lengthy process for disbursement of duty drawback claims, he said. The Prgmea senior vice chairman said instead of involving associations, the exporters have been asked to directly submit their claims to the banks, which have no technical staff to evaluate the claims.

The banks are violating the SBP directives of processing refund cases within 14 days due to unavailability of professional staff, he said, adding that such notifications show the Finance Ministry is in no mood to implement the PM’s package at a time when the country suffers an all-time high trade deficit.

By eliminating the role of the associations, the long delay has been multiplying manifolds, as the banks do not have the required skills to scrutinise the refund claims, he added.