Daily Times

ISLAMABAD: A legislative body of the Upper House of parliament was informed on Thursday that the local textile industry was in a “dilapidated condition”, and its exports were experiencing a declining trend due to a number of issues, including high prices of gas and electricity, high tariffs on import of input materials for industries and restructuring of loans with banks.

Mian Lateef from ChenOne group told the Senate Standing Committee on Textile Industry that at least 40 industries in Khurrianwala Industrial Estate had been closed due to these certain issues, which not only resulted in a sharp decline in industrial sector export but also rendered 400,000 people jobless.

He said that if the government resolved the issue of restructuring of bank loans of industrialists, the units could be revived, which would eventually give a $3 billion boost to the textile exports every year and produce around one million employment opportunities. He said the industrialists did not want their loans written off; they want the loans restructured so that they could stand on their feet and work for revival of their industries.

Federal Minister for Commerce Khurram Dastgir told the committee that industrialists should come up with a mechanism to separate wilful defaulters from others and determine the sustainable and unsustainable industries so that the government could facilitate them easily.

He said the government was committed to resolving all genuine issues of the textile industrialists, and it had already fulfilled a number of their demands, including provision of uninterrupted electricity and gas to the industrial units.

The meeting decided to hold a meeting in Karachi to resolve the issue of banking sector with the textile industry in which representatives of the textile mills, State Bank of Pakistan, National Bank of Pakistan and private banks would be invited.

The minister also informed the committee that despite diplomatic tension between Pakistan and India, the trade regime had not been changed by the government. However, he said that the government had restricted the import of 500,000 cotton bales a year through the Wagah border while there was no such restriction on Karachi port. To a point raised by committee chairman Senator Mohsin Aziz that a huge quantity of raw cotton had been stopped at the Karachi port, he said that the government had not issued any notification in this regard.

The committee chairman said that the government should instead ban the value added products from the neighbouring country in a bid to protect the local textile industry.

A representative of the textile sector, however, pointed out that electric and gas prices in Pakistan were not competitive as compared to those of Bangladesh, India and Vietnam.

Khurram Dastgir said the government had also announced to make five export-oriented sectors zero-rated in the previous budget, while in the next budget the government was planning to allow all key input material used for exports, including machinery, “duty free in order to boost the exports of the country”. Senator Nehal Hashmi pointed out that some industrialists had been placed in the Exit Control List (ECL) and they were not even allowed to go abroad and meet their clients. The committee recommended removal of their names from the ECL.