The Pakistan Industrial and Traders Associations Front (PIAF) has appealed to the government to take immediate measures to arrest the slowdown in exports, as the unfriendly policies would bring Pakistan’s most valuable sector to the verge of collapse, reports WealthPK. PIAF Chairman Faheem ur Rehman Saigol told WealthPK that the export sector plays a pivotal role in foreign exchange earnings besides absorbing the inefficiencies of the energy sector and paying the burden of other consumers, he added. He called for an early refunding of the stuck-up sales tax, income tax and customs rebate – amounting to billions of rupees – to the industry.
Expressing the need for solid steps and consistency in policies, Faheem observed that value-added exports should be increased to get rid of external debts, dictation of IMF and other international financial institutions. Faheem lamented that the government had promised that the refunds payment orders would be issued in 24 hours while the payments would be cleared within 72 hours of the issuance of the RPOs but practically this commitment was not being fulfilled, as the 72 hours had stretched to weeks. He said despite all the commitments, the FBR failed to pay the sales tax refunds of zero-rated export sector within 72 hours.
Consequently, they are unable to procure raw materials and other accessories to execute their orders and this will ultimately affect the country’s foreign exchange reserves. He said severe liquidity crunch was adversely impacting the export growth, as the country’s textile exports had declined by 15.23 percent in Oct 2022 to $1.35 billion amidst undue delay of sales refunds by the Federal Board of Revenue. Faheem expressed his serious concern over the declining trend in textile exports, which had dropped by 1.34 percent to $5.941 billion during the first four months of July-Oct in the current fiscal year against $6.021 billion of the same period of last year.
He said the country’s textile group exports witnessed a decline of 15.23 percent in October 2022 on a year-on-year basis and remained at $1.36 billion compared to $1.6 billion during the same month of last year, according to the Pakistan Bureau of Statistics (PBS). On a month-on-month basis, the textile group registered 11.13 percent negative growth compared to $1.53 billion in September 2022. Raw cotton exports registered 100 percent growth in July-October 2022-23 on a YoY basis. Cotton yarn exports registered 27.73 percent negative growth in July-October and remained at $285.315 million compared to $394.765 million during the same period of the last year. On a year-on-year basis, cotton yarn exports registered 53.79 percent negative growth, while on a MoM basis, it registered 35.30 percent negative growth.
He said the government and all the stakeholders should make decisions in the national interest with confidence. The PIAF chairman demanded that electricity and gas prices for the whole industry be maintained for next year to sustain the previous exports growth. He suggested that the government should continue the regionally competitive power tariff for the export-oriented sector to sustain and uplift exports. “These rates should continue till at least FY23 to bring the sustainability factor, as the sector contributes significantly to overall national exports. If this sector gets no relief, it will ultimately impact the overall economy,’’ he added.
Credit : Independent News Pakistan-WealthPk