LAHORE: Fearing that export orders may drop by 50 per cent in the wake of coronavirus-led lockdown, All Pakistan Textile Mills Association (APTMA) Punjab Chairman Adil Bashir has demanded the government to freeze the interest cost of loans.
In a news statement issued on Thursday, he also urged the State Bank of Pakistan to issue directions to banks for suspension of interest on the long-term as well as working capital loans/advances for a period of three months (from April till June).
The Rs100 billion relief announced by the prime minister could be utilised to defray this cost, Bashir added.
He said the government should make arrangements for the deferment of instalments against all loans for a period of one year and issue a Standard Operating Procedure (SOP) to restart production and protect jobs.”
The APTMA leader also proposed setting up of monitoring committees at district and provincial levels to monitor the production activities at mills.
Payment of utility bills of the textile industry should be deferred by three months, he added.
Bashir demanded the government to direct the Federal Board of Revenue (FBR) for immediate payment of all sales tax refunds of exporters [up to 80pc of the total] within 72 hours of filing such claims.
“In case the lockdown continues beyond one month, the government should share the burden of salaries from funds of Social Security, Employees Old-Age Benefits Institution, Workers Welfare Funds, and other such arrangements under the control of the government.”
Bashir said major buying chains of textile products namely Inditex Group, JCPenney, Mango, H&M, GAP, Levis, Bed, Bath & Beyond, Nike, American Eagle, and IKEA have already shut their businesses, while many other chains and stores are in the process of closing operations.
“The industry estimates suggest that more than 50pc of orders, which were to be shipped in the next 30 days, have already been deferred or cancelled,” he informed. “It will add pressure on the cash flow and force many industries to lay off workers especially when there are rampant reports that big buyers are filing bankruptcies.”
In addition to setbacks to exports, he said, COVID-19 has also adversely impacted the domestic commerce due to the lockdown and closing of all shopping outlets.
The APTMA Punjab chief hoped that the government would streamline issues faced by the textile industry without any delay in the larger interests of exports, investment and employment in the country.