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Monday May 27, 2024

Incentives for textile sector in budget

ISLAMABAD: The government has announced to continue drawback of Local Taxes & Levies Scheme for the textile exporters in the FY 2015-16 under which they will be entitled to the drawback on Freight on Board (FOB) values of their enhanced exports, if increased beyond 10 percent of their previous year’s

By our correspondents
June 07, 2015
ISLAMABAD: The government has announced to continue drawback of Local Taxes & Levies Scheme for the textile exporters in the FY 2015-16 under which they will be entitled to the drawback on Freight on Board (FOB) values of their enhanced exports, if increased beyond 10 percent of their previous year’s exports.
The federal Finance Minister Muhammad Ishaq Dar while presenting the federal budget 2015/16 in the Lower House of the Parliament announced that the rates will be four percent for garments, two percent for made-ups and one percent for processed fabric.
Textiles industry is the mainstay of Pakistan’s economy. It accounts for more than 50% of our exports value and is the single largest employment provider in the manufacturing sector.
In February 2015, the government announced Textile Policy (2014-19) envisaging doubling textiles exports from current $13 billion to $26 billion in next five years focusing on value addition and creating three million new jobs. For the implementation of policy, a financial package of Rs64.15 billion has been already approved.
To resolve the various issues pertaining to textile sector and for implementation of Textiles Policy 2014-19, the government has restructured the Federal Textile Board with majority members from the private sector.
From 1st July 2015, Export Refinance Facility and Long Term Finance Facility will be available for textile-exporters at the most reasonable rates of the history ie at 4.5 percent and six percent respectively. The customs duty on import of textile machinery under SRO 809 is zero for the Year 2015-16 as well.
In order to facilitate and incentive the investments in plants and machinery, Technology Up-gradation Fund Scheme will be launched in the FY 2015-16, as per the provisions of Textiles Policy 2014-19.
The government is committed to introduce latest seed technology. To this end, the National Assembly has passed amendments in Seed Act, whereas Plants Breeders Right Act will also be promulgated on priority basis.
Spadework has been completed on a mega project worth Rs4.4 billion for training of 120,000 unskilled men and women over a period of 5 years. This scheme shall be launched in FY 2015-16.