20000204

PCMA urges

govt to allow

duty-free import

of cotton

RECORDER REPORT

KARACHI: The Pakistan Cloth Merchants Association (PCMA) has demanded of the government to immediately allow duty-free import of cotton in order to ease raw cotton prices pressure in the domestic market.

Mohammad Iqbal Mangrani, Chairman, PCMA (South Zone), said in a statement that the imported cotton was trash free and much superior in quality to the Pakistani cotton and it could be used in finer counts such as 40/1 and 60/1 to manufacture fabrics and garments.

He pointed out that duty-free import of cotton would release pressure on supply of low count yarn to the ancillary industry for producing coarse cloth and other low priced made-ups and would help to stabilise prices of cotton and yarn in the local market.

Mangrani maintained that Pakistani raw cotton contained very high percentage of trash because most of the ginning factories were not equipped with pre-cleaning units. Hence, poor quality of cotton also affects the quality of made-ups which secured much lower prices in world market, he added.

He also urged the government to announce long awaited relief in the form of enhanced rates of duty drawback and reduction in rates of sales tax, income tax and wealth tax, as was promised by Additional Secretary Commerce Sulaiman Khan at a meeting with exporters.

The PCMA zonal chief said that the exporters had already been facing severe liquidity crunch due to delay in payment of sales tax refund and rebate and sudden rise in cotton and yarn prices had further aggravated the situation.