By admin       2016-08-01

All Pakistan Textile Mills Association (APTMA) has expressed great concern over the callous attitude of the government in increasing the duty on import of raw cotton from two percent to three percent which along with the additional duty of one percent has increased the incidence of total import duty to four percent. This at a time when the textile industry is reeling from the effects of a total crop failure as the production of cotton in the year 2015-16 has declined by almost 35 percent. Furthermore, cultivation of cotton this year is expected to decline by approximately 25 percent which will ultimately decline the availability of cotton to the spinning industry compelling them to import cotton at four percent custom duty. Tariq Saud Chairman APTMA said APTMA had been pleading with the government to totally remove import duty on cotton so that the textile industry could operate in an efficient manner. "But instead of accepting reality, they have chosen to increase duty and further exacerbate the industry's plight," he added. He further said it was not possible for the textile industry to continue to operate in those conditions and contribute to higher exports and provision of yarn to the domestic downstream if they were made to pay such exorbitant amount of duty on its basic raw material. Pakistan had become a net importer of raw cotton and even then the textile industry was trying to remain competitive while contributing to the national exchequer as well as providing millions of jobs, he added. "But if we have to import over four million bales due to crop failures then import duty must be abolished," he demanded. Chairman APTMA said the government must take account of the situation immediately and abolish all duties and taxes on import of raw cotton. The industry is already suffering due to high cost of doing business and shortage of energy in the country and now even has to compete with a surge in cotton yarn imports from its regional competitors, he added.Tariq said cotton was one of the basic raw materials of Textile Spinning Industry and constituted around 70 percent of raw material cost. Government in the Federal Budget 2016-17 has further increased customs duty from two percent to three percent and has kept the additional duty of one percent intact in the Federal Budget 2016-17, thus total duty become four percent, which makes the basic raw material more expensive. The surge in duty has made the domestic industry unable to compete in the international as well as domestic market which can be confirmed from the fact that during the last Financial Year the imports of cotton yarn has almost doubled as compared with 2014-15, chairman APTMA said. He urged the government to allow import of cotton free of all duty and taxes till the production of cotton matches with the consumption requirement of the domestic spinning industry.

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