ISLAMABAD
Though the government claims it has announced country’s biggest bailout package of Rs 180 billion for enhancing exports, it has only released around Rs 1 billion during the past seven months.
A delegation of Federation of Pakistan Chamber of Commerce and Industry (FPCCI) recently informed National Assembly’s standing committee on finance that the bailout package was not making any difference in exports since the exporters have received only Rs 1 billion worth incentives under the much-hyped program.
“The package for textile industry was just an announcement, as only an amount of around Rs 1 billion has been released under the package yet. Though we have requested the ministry of commerce, finance and relevant authorities to relax the conditions for availing the facility, it seems the package was announced for political point scoring,” they said.
According to a member of FPCCI, the exporters were not taking the incentive package seriously because payment against claims of 2017-18 would be made in 2018-19 on the basis of 10 per cent growth in exports which implied if an exporter showed less than 10 per cent growth he/she would not be eligible for incentives.
“Exporters will get duty drawback on shipments dispatched till June 2017 within a few months as claims will be submitted in September or October. However, the government has not allocated funds for the package in budget 2017-18 due to which exporters are not taking it seriously, or calculating the rebate in their cost, or going for aggressive marketing,” he added.
The exporters, especially, members of All Pakistan Textile Mills Association (APTMA) had demanded the government to do away with the condition of 10 per cent growth in exports which would propel exporters towards aggressive marketing for the rebate and consequently reduce their prices vis-à-vis their competitors.
The exporters complained that their demands and suggestion related to the package were not being given due importance because of lack of coordination among ministry of commerce, the ministry of textile industry, the ministry of finance and Trade Development Authority of Pakistan (TDAP) etc.
Besides, the government has allocated an amount of Rs 4 billion only for the next financial year against the total textile package of Rs 180 billion for a period of 18 months based on the requirement of Rs 10 billion per month.
“The allocation in budget clearly shows the government’s attention; how much is it serious to support the exports and domestic industry,” they added.
The bailout package was announced by Prime Minister Nawaz Sharif in January 2017 to support ever falling exports. The package envisages abolition of customs duty and sales tax on import of cotton. Similarly, customs duty on man-made fibre rather than polyester and sales tax on import of textile machinery were abolished under the package.
