20000131

10 percent duty

on yarn export

demanded

RECORDER REPORT

KARACHI: The textile value-added exporters have demanded of the government to immediately impose 10 percent duty on export of yarn and withdraw re-finance facility on yarn to save the export of value-added textile products from total collapse.

M. Iqbal Mangrani, chairman of the Pakistan Cloth Merchant Association, (PCMA) Southern Zone, in a statement cautioned the government that if immediate steps were not taken to stop the mills from hoarding huge stocks of cotton and export yarn at throw away price, the export target of even $8 billion could hardly be achieved.

He pointed out that as a result of sound liquidity position of members of Aptma which was perhaps due to lavish grant of re-finance on export of yarn, some textile mills were reported to have stocked raw cotton for one year after purchasing the same at the record low price of Rs. 1200 per maund. On the other hand, he said the prices of yarn which ought to be cheaper due to surplus cotton stocks this year, were kept on increasing the benefit of the spinners and at the cost of the textile ancillary industry.

Mangrani said that the value-added textile exporters were facing the worst crisis created by the local spinners as prices of all kinds of cotton yarn and polyester/cotton blended yarn had increased to at least 20 percent during last week. This was contrary to the fact that the prices of raw cotton and polyester fibre had been reduced substantially but benefit had not been passed on to end-users but it was only multiplying profits of the spinners, he added.

The PCMA maintained that non-availability of yarn at reasonable prices would cripple the value-added textile exports which was already dwindling due to lack of interest of our major buyers in Far Eastern countries which were still waiting to place new orders after the Chinese new year holidays between February 4 to February 10, 2000.