KARACHI, Aug 20: Exporters have criticized the Export Promotion Bureau (EPB) for putting additional condition for availing ‘over-programming’ for the quota year 2003 as this has resulted in pushing quota prices sky-high in open market.

The EPB for the last two to three years has been allowing 10 per cent ‘over-programming’ for a quota year, which is mainly done to ensure maximum utilization of quotas and exports.

In the past, condition for availing ‘over-programming’ was restricted to utilization of performance quota and quotas lifted by exporters through auction. However, this year the EPB has put an additional condition of utilization of ‘shift quota’ that soared quota prices in open market.

The condition to utilize 15 per cent shift quota, which is created from quota category 638 (ladies and men’s tops made from man-made fibre) against the utilized categories of 338 men’s top 100 per cent cotton) and 339 (ladies top 100 per cent cotton) in the ratio of 1:2.16, has pushed the prices of all these categories sky-high.

Exporters said that until last year the EPB used to give ‘shift quota’ from its own stocks to the exporters and never put such a condition which could be damaging to exports of the country.

The EPB and the Quota Supervisory Council (QSC) are playing a big game with exporters in order to protect the interest of some stock brokers and barons, alleged Pakistan Hosiery Manufacturers Association (PHMA) chairman Aslam Ahmed Karsaz.

Under the flexibility programme, he said three category of quotas — carryover, swing and shift — were allowed to the exporters. The two former categories carry no impact on quota prices, whereas the third category — shift — does have its impact on the prices because it is linked with fast running and hotcake categories (338 and 339).

Aslam Karsaz further said that under the ‘swing’ an exporter could ‘convert’ his under-utilized category into high demand and hotcake category, whereas in ‘shift’ the exporter by surrendering category 638 could enhance his quota holding in category 338 and 339 up to 15 per cent and could make exports against it.

According to official figures released by the EPB and the QSC, out of the base quota figures for category 338 (7,208,835 dozens) and 339 (2,307,030 dozens), a total quota for both the categories comes to 9,515,865 dozens, which means a 15-per cent shift quota against category 638 in the ratio of 1:2.16 comes to 661,824 dozens.

Whereas base figure for category 638 stands at 816,663 dozens and adding to it flexibility (swing) of 261,332 dozens, total quota stands at 1,077,995 dozens, and after deducting the shift quota of the quantity 661,824 dozens created from 338 and 339 (both hotcake), the EPB and the QSC have shown adjustment ceiling of 416,171 dozens.

However, Aslam Karsaz has alleged that as to why the authorities have held back a huge quantity of 661,824 dozens created in 338 and 339 categories through shift from category 638. As a result of this, he said, the prices of not only 338 and 339 had shot up in the open market but also of category 638, thereby damaging the export trade.

The PHMA chief questioned the wisdom of the EPB and the QSC in changing the policies by putting additional condition, while the Ministry of Commerce in its August 11 advice did not put such a condition. He said the EPB and the QSC should revert to the past practice and avoid indulging in such practice which could be damaging to the export trade.