The associations of value-added textile on Wednesday warned the government of countrywide protests and strikes if it did not restrict the cotton yarn export to maximum 50 million kg per month within the current week. "The government had agreed last month to cap the cotton yarn export to 50,000 kg a month but did not implement its decision, which further increased the commodity shortage on the local market," said chief co-ordinator of PHMA M Javed Bilwani.

Speaking at a press conference at Pakistan Hosiery Manufacturers Association (PHMA) House, he said that "the government has made us fools with a wrongly scripted SRO on capping of yarn export". There were also representatives of value-added textile associations including Pakistan Cloth Merchants Association, Pakistan Sweaters Exporters Association, Towel Manufacturers Association, Pakistan Textile Exporters Association, Pakistan Cotton Fashion Apparel Manufacturers Association etc.

Bilwani said: "Despite meeting with Federal Finance Minister Shaukat Tarin who accepted that the respective SRO had encountered problems in its script and said that it will immediately be corrected, but there is still no corrective move by the government." He added that the grim situation, which was prevailing prior to December 8, 2009 decision, still persisted.

He said: "The government has not stopped the additional volume of yarn export over 50 million kg and still 62 million kg of the commodity was exported, which is a violation of its decision." He termed the SRO as "eyewash" and mere a piece of paper on which there is no hope of implementation, saying that the value-added textile units are rapidly going towards closures in the wake of cotton yarn shortage.

Citing the customs export statistics, he said that there was about 47 percent increase in the yarn export as compared to its export of the last fiscal year. He said that the government's HS code has been violated with exemption of few yarn items export, which is also hurting the value-added sector.

He alleged that the spinning mills are not accepting long-term orders of the local buyers which also created the commodity's availability problems on the local market. He pointed out that about 46 percent dollar earning from the value-added textile sector had declined whereas export of yarn increased by 109 percent this fiscal year comparing to the commodity's export of last fiscal year.

He demanded of the government to ban yarn export because such move will narrow the swelling trade deficit with increase in export of value-added textile products. Bilwani pointed out that the existing dyeing and knitting units are also moving towards closures, while some have been relocated to other countries including Africa and Bangladesh.

He claimed that closure of value-added textile units is taking place on daily basis, which causes huge unemployment in the country. He said that there is a complete agreement among the value-added textile associations to set up a facilitation desk primarily aimed at supporting industrial units those want to relocate to other countries.

The PHMA's chief co-ordinator said that the government's ambitious textile export target of $25 billion is a "dream' which will never come true under the present circumstances, saying that there should be first a proper support programme to the exiting industry. Moin A. Razzak, Rafiq Godil, Shahzad Arshad and several other representatives of value-added textile associations were present.

Source: Business Recorder