All Pakistan Textile Mills Association (APTMA) has demanded of the government to withdraw 4.5 per cent import duty on Polyester Staple Fibre (PSF) in budget 2009-10, besides removing import restrictions, which are burdening the industry heavily.
In the year 2008-09, customs duty on import of PSF was fixed at 4.5 per cent whereas PSF was allowed to be imported in the ‘duty and tax remission for export’ (DTRE) scheme.The APTMA claimed the local textile industry was running short of PSF, leading to a situation where it is not available even on cash payment. In addition, many man-made fibres (MMF) including viscos, modal, acrylic, tensil, etc are also being protected despite the fact that no domestic manufacturing is done. Import duty of 6 to 6.5 per cent is imposed by the government on other MMF, hampering the growth of textile value chain.
An APTMA spokesman stated, “Incidental effects of such protections on PSF and MMF are very high, especially in the absence of a tangible zero rating system in place. This situation is leading to many ills including no product diversification, anti-domestic commerce and hindrances to the introduction of a technical textile industry.”
During the current fiscal, he said, PSF production dropped due to the closure of a local manufacturing unit. “This has created a shortage in the domestic market.”
He said the crisis in the textile industry has been aggravated by the reluctance of banks to extend financial services to many spinning mills, especially to establish letter of credits for import of PSF. “This has led to further scarcity of PSF in the domestic market and increase in sales price by domestic manufacturers ."
