LAHORE - The Pakistan Readymade Gar­ments Manufacturers and Ex­porters Association (PRGMEA) has stressed the need for con­tinuing duty-free import of cot­ton and yarn from all over the world till the country becomes self sufficient in the raw material.

PRGMEA newly-elected re­gional chairman Sheikh Luqman Amin stated that Pakistan has been unable to achieve its full exports potential due to lack of product diversification and lim­ited access to raw-material. All taxes and duties on cotton yarn import should be terminated on long-term basis to achieve price competitiveness and product di­versification, he added.

He said the Economic Coordi­nation Committee (ECC) of the Cabinet had announced to with­draw customs duty on import of cotton yarn in April this year for the period of three months in order to ensure smooth supply of it to the value-added apparel industry. The government’s ear­lier move of withdrawing five percent regulatory duty in Dec 2020 on the import of cotton yarn, and then removal of cus­toms duty in April 2021 greatly supported the apparel sector and contributed to the country’s economic stability, which needs continuation, he added.

“As the relief has been with­drawn after June 2021 amidst shortage of cotton, export growth is expected to be af­fected severely, which should be avoided at any cost,” he said.

All taxes and duties on cotton yarn import should be terminated on long-term basis to achieve price competitiveness and product diversification

PRGMEA Chief Coordinator Ijaz Khokhar appealed to PM Ad­viser on Commerce and Invest­ment Abdul Razak Dawood to put this demand of PRGMEA be­fore the ECC once again for the continuation of taxes and duty-free import of cotton and cot­ton yarn from across the world as shortage of yarn still persists and the exporters are presently not booking foreign orders due to scarcity of raw material.

At a time when the exporters are facing financial crunch in the wake of 700 percent jump in sea freight charges and uncer­tainty in rupee-dollar exchange rate, the duty-free raw material would provide some cushion to the apparel sector, which is suf­fering a huge shortage of indus­try raw material, he observed.

The PRGMEA still thinks that the real solution of raw mate­rial shortage lies in opening of import through land route, as cotton yarn import via sea can never become the substitute of extremely low-cost yarn via land route particularly in the wake of exorbitant hike in freight rates of shipping lines, he added.

PRGMEA regional chairman asked the government that pre­vious relaxation of customs duty on yarn import should not have been limited to just three months, rather it should have been continued until the coun­try is capable of meeting textile value-added industry’s demand of 10 million cotton bales.

He said the apparel industry has stopped to book orders, as the exporters are no more ca­pable of entertaining the inter­national market generally due to price factor and especially because of artificial shortage of cotton yarn created by the spinning industry which was holding stock in the hope of further hike in rates.

Sheikh Luqman Amin re­quested the prime minister to direct the ministries concerned to focus on the value-added ap­parel sector and prepare a sol­id strategy to help the industry stay afloat.

He said the country has been unable to achieve its full ex­ports potential due to lack of product diversification and limited access to raw-material. To this effect, he added, the all taxes and duties on cotton yarn import should be termi­nated on long-term basis so that exporters could be able to achieve price competitiveness and product diversification.

As the country receives huge exports orders, local produc­tion of cotton is not sufficient to meet the demand of the tex­tile. Cotton was not available at competitive prices due to the CD and hectic procedures.