KARACHI: The Economic Coordination Committee (ECC) decision to withdraw 5 percent duty exemption on import of cotton yarn will cause a huge fall in value-added textile export under GSP plus facility to EU countries. The decision will have serious repercussions for the textile sector which is already reeling from many other challenges, said Pakistan Apparel Forum (PAF) Chairman Muhammad Jawed Bilwani.
He said the value-added textile sector continued to suffer huge financial losses since the rupee began appreciating against the dollar. “Now it is strongly felt that the withdrawal of 5 percent duty exemption on import of cotton yarn will push the entire sector to undergo acute cotton yarn shortage,” he feared. The PAF chief anticipated that the shortage of cotton yarn was likely to push its prices upward in the local market, leaving the entire value-added textile sector uncompetitive against international competitors. “Several adverse factors like rising business cost, energy shortage, poor infrastructure, deteriorating law and order situation will have a negative impact on textile export to the EU under GSP Plus regime,” Bilwani said.
He stressed that the government had to review the ECC decision as it was going to affect the textile export. He said the government should also impose duty on export of cotton yarn so as to create a balance market for the value-added textile exporters.
