Garments manufacturers decry withdrawal of textile and apparel policy 2020-25

Lahore: The Pakistan Readymade Garments Manufacturers & Exporters Association (PRGMEA) has lambasted the Minsitry of Commerce for withdrawing Textile and Apparel Policy 2020-25 despite the approval and ratification by the Eonomic Coordination Committee and Cabinet after a long delay.

They association called for the reversal of the decision and its speedy implementation, as accoridng the garments manufacturers it is vital for new investment and marketing plan in the major export-oriented sector.

PRGMEA north zone chairman Sheikh Luqman Amin, in a letter written to the Ministry of Commerce, observed that withdrawal of this policy would affect the value-added garments sector badly, as it is against the slogan of the prime minister’s vision of promoting exports.

"We are already far behind the regional countries with regard to exports due to poor policies, as we set the target of achieving Bangladesh’s export level but adopt the policies of Ethopia," he lamented.

Amin said ECC last month had finally approved the Textile and Apparel Policy 2020-25, with the directives to relevant stakeholders to take the Federal Board of Revenue and power division’s input, but now the policy is being withdrawn on the interference of Finance Ministry, leading to further delay in implementation of this vital policy.

He said the textile policy has been pending since 2019 and several drafts were submitted to the ECC for approval and now the ministry is going to withdraw it to incorporate inputs of the FBR and the finance division while finalizing this Policy of 2020-25, which will further delay its implementation.

He warned the government of removing incentives from the new textile and apparel policy, especially the DLTL, saying the move will damage the exports, amidst growing trade deficit in the country.

Amin added that a clear and long-term policy will provide investors a clear vision that the government of Pakistan is ready to support the apparel sector of Pakistan on long-term basis.

He said the garment industry has been affected seriously due to long delay in the final announcement of the new textile policy by Economic Coordination Committee of the cabinet in the past, as the PM had given approval in this regard a long ago. 

The PRGMEA regional chairman said the government had announced several schemes in the past, including duty-free import of textile machinery, reduction of mark-up rate for export refinance settlement of outstanding refund claims and rationalization of refund regime, but the sector was not getting benefits yet.

Textile sector contributed about 60 percent to the country’s total exports, besides providing direct and indirect millions of jobs which required a proper policy, he added.

He was of the view that further delay in the implementation would result in delay or even backing out of investors from future local and foreign investment in the industry.

Presently, we are in short production capacity and several exporters are refusing export orders because there is not enough capacity available in the country.

He claimed that targets set were ambitious and financial commitments of Rs188 billion and Rs65 billion respectively for first 2009-14 and second 2014-19 Textile Policies were made by the past governments to achieve them.

However, commitments were not fulfilled and timely payments were not doled out in financial support schemes. Further, funds were not allocated for public sector development under infrastructure, vocational training, productivity and compliance related programs.

He urged the government to redress the problems of the industry by taking comprehensive and innovative solutions in the new textile and apparel policy.