High test charges for products hit small exporters
By Parvaiz Ishfaq Rana
KARACHI, April 5: High charges taken by the government-owned ECO Textile Laboratory for making various tests are causing a lot of problems for small and medium exporters who have to meet the conditions laid down by their foreign buyers.
The Synthetic Fibre Development and Application Centre, ECO Textile Laboratory, set up with a cost of Rs68 million dished out from the Export Development Fund (EDF) is of no benefit to small and medium sized exporters who have to pay high charges for various tests required for export goods.
The laboratory, which was established about three years ago, was to facilitate small and medium sized exporters for testing their export products as required by their customers. Furthermore, it was also visualized that the upgraded testing facilities would help meet the quota-free requirements.
Exporters complain that for one single test they have to pay around Rs15,000 to Rs20,000, which puts extra burden on input cost of products. According to the price list of ECO Textile Laboratory for the year 2003, there had been an increase of around 30 per cent in charges for most of the tests, over the previous price list of 2002.
Former chairman, Pakistan Bedwear Exporters Association, Shabir Ahmed, said that at the time when Rs68 million was sanctioned from the EDF for the establishment of the laboratory, most of the infrastructure was existing, particularly the building and some lab equipments.
"But the question is where this huge amount of Rs68 million has been spent, and even after the lapse of so many years no audit has been carried out?" He was critical about high charges of testing and said the exporters were suffering badly as they could not afford to pay huge charges.
Mr Ahmed said that each order placed by a foreign buyer required several tests, including AZO-dyes, which alone cost Rs4,250 to Rs5,450. Similarly, print durability test costs Rs1,000, and identification of yarn or fibre costs Rs3,200. In total, a single export order could cost up to Rs40,000 to an exporter, he added.
Despite the fact that the ECO Textile Laboratory had been set up with the fund raised from exporters but they have no say in its working/operations. Mr Ahmed demanded that a board be constituted with members from the private sector. He was highly critical about the Export Promotion Bureau's role and said that the price list issued by the laboratory carried EPB's logo.
"This means that the rates have been approved by the bureau." If the EPB officials do not realize that what could damage the exports then who else could defend the interest of exporters, he maintained.
Large industrial setups having their in-house test lab facilities do not incur huge cost, whereas small and medium sized exporters are compelled to pay high price for each test. If test charges are brought down, it would not only benefit exporters, but would also result in high turnover, bringing in more revenue to the lab.
