As companies are re-opening worldwide, manufacturing companies in Pakistan, mainly in the textile sector, are receiving orders from various exporting countries, which could result in the utilization of 80-90 per cent of production capacity by the next quarter, leading to an export of $17.5 billion in the financial year 2020-21.
All Pakistan Textile Mills Association (APTMA) in a letter sent to Prime Minister said, “Export earnings from the textile sector are likely to increase by $3 billion this year, taking into account demand from the international market, which will not only increase exports from the sector with a potential value of $17.5 billion, but could increase the country’s total exports by $27 billion in the next financial year.”
The letter said that the export earnings of the textile sector will also support declining foreign exchange earnings in the event of declining remittance inflows.
However, these benchmarks could also be achieved by textile exporters if the government revisits the financial bill and introduces incentives for the sector, APTMA added.
APTMA called for competitive pricing of energy, including electricity and gas, and asked the government to reduce the sales tax rate and ensure that refunds would be issued quickly.
In addition, the turnaround tax for textile exporters and manufacturers should be reduced from 1.5% to 0.5%.
The steady increase in the production capacity of the textile sector will also support local industries and create employment for thousands of workers, in addition to investment by foreign and local investors.