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New initiatives in Textile Package result in increasing textile products

New initiatives in Textile Package result in increasing textile products

ISLAMABAD: The initiatives announced under the Textile Package incorporated in the finance bill 2014-15 has enhanced exports of textile products to $13 billion of which exports to EU stand at $5 billion.

 “Besides, Textile Package, GSP-Plus status granted by the European Union to Pakistan has also significantly contributed to this increase because Pakistan is strong in the area of bed linen and home textiles” a well placed source at Ministry of Commerce (MoC) told this scribe here on Thursday.

 In result of GSP-plus facility, 90% textile products are covered under 14% of the tariff lines and 10% products come under other 70%t tariff lines which are not made in Pakistan. So the annual impact of GSP-plus on Pakistan’s exports will hover around $220 to $300 million.

 MoC and Textile Ministry monitor the updates related to export of textile products on regular basis. GSP+ was granted in January 2014. During January-October 2014 the exports to EU were Euro 3.26 billion compared to Euro 2.65 billion in corresponding period of previous year, an increase of 22.9%

 However, the issue of energy crisis has been addresses by the Government last year and this year as well through decision made by the Economic Coordination Committee (ECC) of the Cabinet.

 Moreover, the MoC with an objective to facilitate the textile sector moved some special initiatives in Textile Package, including local taxes and levies would be given to exporters of textile products on FOB values of their enhanced exports on an incremental basis if increased beyond 10% over previous year’s exports

 Mark up rate for Export Refinance Scheme of State Bank of Pakistan is being reduced from 9.4% to 7.5% from 1st of July 2014. Textile industry units in the value added sector would be provided Long Term Financing Facility (LTFF) for up gradation of technology from State Bank of Pakistan at the rate of 9% for 3-10 years duration. Duty free import of textile machinery for the period of two years was announced.

 A new vocation training programme will be launched to train 120,000 men and women, over the five year period, for skills required in the value added sector such as garment and made ups etc.

 The key motive behind the growth of textile exports is the national GSP plus successful from Jan 2014 because of textile export to the EU which is increased by 18% to reach $ 5 billion figure for the first time in Pakistan history because of the GSP plus status granted by the European Union, and textile exports to the left of the globe fell by 3.5%.

 Seeing this textile export Pakistan government is ready for a 5-year program to grant subsidies for the textile sector. Under the latest planned textile strategy (2014-19), textile industry will be rewarded. Followed by the strategy, textile exports will increase over the next five years, $ 26 billion, in addition to the creation of employment opportunities.