Garment exporters in Pakistan are opposing the demand by spinners to re-impose 5per cent duty on yarn imports from India. The demand for withdrawal of the duty exemption on India’s yarn was made by Aptma to restrict its imports after New Delhi announced a 4per cent rebate on its exports after the EU granted GSP+ status to Pakistan.
While Aptma is of the opinion that the duty rebate would make Indian yarns much cheaper compared to domestic products, Prgmea on the other hand is in favour of the rebate, since it would assist the export community in increasing exports of quality products to the EU. Aptma argues that Indian textile industry is already enjoying several incentives in the form of low energy prices, almost free credit and export rebates, which are causing dumping of cheap yarn in Pakistan, affecting the domestic production. And to control yarn imports from India, it has demanded re-imposing of five per cent duty to protect the domestic industry.
Prgmea, however, feels that at a time when small garment exporters have been hit hard by abrupt appreciation of the rupee, imposition of duty on Indian yarn would further lead to a rise in domestic prices at the cost of value-added exports. The imposition of duty, will increase domestic yarn prices putting pressure on domestic production cost. And if there are no value added textiles to exports then the GSP+ concessions would not mean anything.
The ministry has called for a meeting with stakeholders belonging to both sides to take a decision on the issue.
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