The taxing structure and surcharges have heavily affected Pakistan’s textile industry, making the trading atmosphere uncompetitive for Pakistani textile manufacturers and traders.
A research done by All Pakistan Textile Mills Association (Aptma) suggested that 5 per cent taxes and surcharges are imposed on the export sector in the country. The Indian counterparts, on the other hand, enjoy a tax-free regime on the export of textile products. The taxes in Bangladesh and China are also close to 1 per cent.
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The report, quoting the World Trade Organization, suggested that the country registered only 18 per cent growth in the textile and apparel industry from 2006 to 2014, while Bangladesh, China and India registered 175 per cent, 107 per cent and 96 per cent respectively in the same period.
“Other irritants include energy tariff, under-utilisation of power generation capacity and energy shortage,” the report stated. The textile export of Pakistan rose to $13.8 billion in 2010/11 and continued its momentum till 2013/2014. But, the exports experienced a slump of $13.5 billion in 2014/15.
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The textiles ministry of Pakistan aimed to double value-addition to two-billion dollars, which will increase the annual exports to $26 billion during the five years. The All Pakistan Textile Mills Association (Aptma) aimed to target $20 billion worth of textile export by 2018 in order to create eight million value chains. For this, they sought immediate withdrawal of surcharges on gas and electricity.
