Lahore, May 08, 2018 (PPI-OT): The Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) has asked the government to declare export emergency in the federal budget for 2018-19, which is presently under discussion in the national assembly, as there is no other shortcut to control the ballooning trade deficit of the country.
PRGMEA Senior Vice Chairman Sheikh Luqman Amin termed the federal budget very disappointing and political, aimed at attracting the voters, as no incentive was announced in the Budget for export industry. He said that the budget has disappointed the value-added textile industry as the government has not announced implementation of the proposals given by the industry.
The industry had mainly demanded the extension of the PM incentive package (unconditionally) for another two years which was not announced. Moreover, the PRGMEA had demanded the clear roadmap of payment of refunds within weeks not in months or years in view of the liquidity crunch of the industry. PRGMEA Senior Vice Chairman appealed the Finance Ministry to release the funds without any further delay, as more than 30 percent cash flow has been blocked since long in the shape of sales tax refund and Customs rebate, which is adversely damaging cash liquidity.
The ministry has not yet released the major amount of the previous Rs180 billion PM’s package to be processed from January 2017, he said, adding that the government should take steps for the removal of hurdles hindering textile sector exports. Moreover, in this situation of financial crunch the textile value-added products are unable to fetch a high value due to poor packaging.
He said that Pakistan Readymade Garments Manufacturers and Exporters Association, in its budget proposals for 2018-19, has called for ease of doing business, lowering cost of production, solution of liquidity crunch through early refunds payment, equal energy tariff and relaxed import policy for industrial raw material so that industrialisation can be promoted and exports can be enhanced but none of these points were included in budget documents for approval in the national assembly.
“The budget did not explain as to how the government was going to revive the industrial sector, particularly textile industry, which contributes 60 per cent to the country’s total exports.” About three million people are employed by the textile industry and another three million indirectly, but the budget said nothing for the revival of the sector, he further said.
The budget failed to address anything regarding industrialisation; how to enhance exports; how to increase foreign exchange reserves and how to create employment opportunities in the country, he highlighted. He suggested the government to have focus on solving the issues of current account deficit and trade deficit otherwise it is feared it has to go for another IMF program. The government should ensure zero rating of all inputs in true spirit including packaging materials, spare parts.
For more information, contact:
Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA)
3rd Floor, Plot No. 57-C, 24th Commercial Street,
Phase II (Ext), DHA, Karachi, Pakistan