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|Title : Business Recorder, Tribune, Nawa e Waqt, Khabrain, Aman,|
|Published Date : 01 Apr 2016|
Pakistan Textile Exporters Association (PTEA) have demanded immediate payment of outstanding refunds without any discrimination of Rs. 5 million or above to get significant export growth. Huge stuck up liquidity is the major hurdle in export promotion; adversely impacting the economy, said Asghar Ali, Chairman and Arif Mahmood Qureshi, Vice Chairman PTEA in a statement here today.
Expressing grave concern over long outstanding refunds, they said that massive working capital of textile exporters around 30% is still blocked in sales tax, custom duty drawback and income tax refund regime which is the major cause of export decline. Furthermore, incentives announced by the Government in textile policies (2009-14 & 2014-19) under incremental exports scheme (DLTL) and technology upgradation fund scheme are still to be paid. Severe cash flow crunch is gradually eroding the biggest job providing textile export sector; consequently, sizeable textile capacity had been severely impaired and textile exports, both in quantity and value terms, had declined across the value chain. This is having adverse impact on the employment and the economy of the country. In present refund regime, 5% of export revenue gets stuck up resultantly massive working capital has been held up; whereas refunds of goods exported 12 month earlier are still outstanding, they lamented. They said that finance is imperative to run the wheel of industry but without this, no one could even think to run industry. Government should set its priorities right and accord preferential treatment to boost the exports and generate industrial activities.
PTEA Chairman Asghar Ali said that it is the right time that Government should revive ‘No tax-no refund’ regime for the export-oriented sectors as the cost of production has increased, resulting in decline in textile exports. He appreciated the Government’s intentions to resolve the refund issue by giving assurance of payment of refunds upto Rs. 5 million but most of the exporters fall in the category of refunds more than Rs. 5 million/month. He urged the Government to pay all outstanding refunds without any limit. He termed value added textile sector as the backbone of the economy with great potential for earning foreign exchange but around 54 percent of nation’s exports and 42 percent employment are heading towards disaster because of declining trend in the exports. Concerning over continuous export decline, he said that competing countries are rapidly multiplying their exports just because of the edge they have on the cost of doing business and other incentives offered by their Governments. Pragmatic policies in consultation with stakeholders need to be formulated to reduce the cost of business by fixing rates of inputs in line with competing countries in the global market to create a level playing field, he suggested.
PTEA demanded the Government to bail out textile industry and exports from financial crisis by removing hurdles and provision of necessary incentives to increase the textile exports of the country. They demanded immediate release of blocked funds in refund regime without any discrimination enabling them to retain their hard earned export markets at this time of tough competition in international markets.