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Textile package in Budget 2014-15: 992 new knitwear units registered in a year

Textile package in Budget 2014-15: 992 new knitwear units registered in a year

ISLAMABAD: The incentives announced in the Textiles Package in Budget 2014-15 by the government has produced good results and some 992 new knitwear units have been registered in been in the fiscal year 2013-14.

“The number of registered knitwear units was 1174 in 2005 in all four major hosiery producing districts including Karachi, Lahore, Faisalabad and Sialkot and incentives in Textile Package worked successfully to infuse a new life in hosiery sector” a well placed source at Ministry of Commerce (MoC) told his scribe here on Tuesday adding that presently hosiery and knitwear industrial network comprised 3,500 large, medium and small units, 85% of which were small enterprises, 10% medium ventures and only 5% large integrated factories.

The source while giving up district wise break up of new registered knitwear units said that there were some 374 units in Karachi, 180 in Lahore, 267 in Faisalabad and 176 in Sialkot.

“Hosiery and knitwear industry provides jobs to 700,000 people in an environment dominated by redundancies and downsizing in giant multinationals, foreign banks and big corporations and industry sustains directly, livelihood of 210,000 skilled workers and their families; 490,000 unskilled workers and their kith and kin. Another 350,000 people benefit in allied cottage industries” the soured observed

The source said that according to Pakistan Hosiery Manufacturers & Exporters Association (PHMA), is the premier trade organization representing the hosiery and knitwear industry accelerating and providing growth in all sectors of the economy, generating immense employment and promoting national self reliance, knitwear units had been showing a very good performance in accelerating national exports of hosiery to $ 2.3 billion per year

PHMA, was established by a few dedicated industrialists and leading manufacturers of hosiery and knitwear and registered with the Ministry of Commerce under section 26 of the companies act 1913 on the in July 1960 and incorporated under the companies act 1913 in August same year with the main object: “to promote, develop, protect, stimulate and encourage the hosiery, knitwear and all made-ups, fabrics, home textile products of cotton, wool, silk or man-made fibers and to raise the standard of their production and enhance exports” among other aims & objects.

The source said that Textiles Package in Budget 2014-15 carried four major incentives including withdrawal of local taxes, easy finance, long term financing facility and tariff on machinery imports.

“In the withdrawal of local taxes category, local taxes and levies were 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” the source said adding that in easy finance category, mark up rate for export refinance scheme of State Bank of Pakistan (SBP) was reduced from 9.4% to 7.5% from July 01, 2014.

“In the long term financing facility (LTTF) clause, textile industry units in the value added sector were provided long term financing facility (LTFF) for up gradation of technology from SBP at the rate of 9% for 3-10 years duration” the source added saying that in tariff on machinery imports category, duty free import of textile machinery for the period of two years were allowed and a new vocation training programme was announced to train 120,000 men and women, over the five year period, for skills required in the value added sector such as garments and made ups etc.

It is pertinent to maintain here that industry provides directly and indirectly sustenance to well over a million people and knitwear exports consist of knitted and processed fabrics knitted garments; knitted bed sheets, socks etc and has the largest share of the nation’s textile exports.  It is also worth mentioning here that all the exports of all the above knitted products are over 35 % of the nation’s exports and the knitwear industry consequently emerges as the countries top foreign exchange earner.