AMER SIAL
The textile millers have asked the government to announce the “textile revival package” before the end of this year so that they could start negotiations with the global buyers for supplies during 2017. An official source said that the various textile organizations have conveyed to the government during the last few days that the package should be announced immediately so that they could negotiate with global buying houses. The government was working on a textile revival package that would include relief measures rescheduling in payment of debt, reduced energy tariff and lowering on taxes, the source said adding that since many departments were involved so it was taking long time to reach the final settlement. The textile sector is demanding announcement of the package sooner as the procurement orders for summer are placed during January-March period. They had previously stressed to provide incentives in June-July period but the government was not ready if some incentives were provided then the exports would have picked up by now. Due to the decline in textile exports, the non-performing loans of the textile sector have reached to Rs 197 billion nearly 26.3 per cent of the total advances of Rs 748.8 billion to the sector, latest data of the State Bank of Pakistan said. The textile millers wanted loan rescheduling to revive their sick units. The textile industry considers the lingering energy crisis and war on terror as the major reasons for the decline of textile exports after the post quota era of free trade under WTO. The government’s subsidies to the firms of China, India and Bangladesh are another key reason for dwindling exports. The Musharraf government provided fiscal incentives to textile sector for balancing modernization and restructuring (BMR) in the pre-WTO era. Since the cheap financing was available during 2003-2006, most of the companies doubled their production capacities to meet economies of scale. The textile industry has claimed that more than three million jobs were lost during the last three years. During this time, Pakistan’s textile exports have declined by more than $3 billion per annum. They claim that resolution of their debt issues would help revive the sick units that will provide employment to over 2 million people and enhance textile exports by $2 billion during the current fiscal year.
