04 December 2004	Saturday	21 Shawwal 1425

KARACHI, Dec 3: Frequent changes in quota policy by the Export Promotion Bureau to face the US embargo on some fast running categories have deprived genuine exporters of their own quotas. The policy only benefited big businesses at the cost of deserving exporters.

"Since the US customs imposed embargo and the EPB notified it in the middle of the last month and stopped issuing further visas against shipments, several meetings were held with exporters' representatives to tailor a new policy framework to respond to the situation," asserted a leading exporter of knitwear garments.

However, formal orders issued, in some cases, contradicted the understanding reached at meetings. "The official documents proved to be quite different from the agreed parameters that amazed exporters and ultimately resulted in damage to small and genuine exporters who could not get quotas," lamented Pakistan Knitwear and Sweater Exporters Association (Paksea) chief Anis Marfani.

He said initially exporters suggested to the ministry of commerce to ask all the exporters to surrender their quotas and thereafter all exporters should be allocated 40 per cent of their actual quota held in their category pass books (CPB).

After agreeing upon this the next day a different policy was announced by the EPB under which a pre-shipment condition was laid down for category 338 USA. The exporters were asked to deposit four per cent (Rs104 per dozen) security against quota in the CPB in the form of pay order or demand draft.

Another condition for getting the quota was that in case an exporter fails to make shipment within 15 days from the date of issue of pre-shipment certificate the security deposit will be forfeited.

The exporters complained that many of their shipments had gone by that time or were in transit from upcountry. "The biggest 'joke' was that the EPB official at that time did not even issue application form for pre-shipment authorization," he added.

In the meantime, when small and genuine exporters were busy in meeting the condition of providing four per cent security deposit, some big exporters with the connivance of "some officials or due to loophole in the policy" manage to corner huge quantity of the quota, leaving nothing for small and medium size exporters, Mr Marfani said.

"The biggest weakness in the policy was that it was only valid up to December 1, 2004. How could an exporter meet security deposit condition for a policy announced on Nov 29, and application form for pre-shipment authorization was made available on Nov 30, 2004?"

When small and medium exporters approached the EPB after getting their security deposit and other documents they were told that the quota had already exhausted, Mr Marfani exhorted.

He alleged that frequent changes in quota policy also pushed quota prices of 338 category higher in the open market, particularly when Rs100 was being demanded as security deposit at the official level.

Consequently, he said many small and medium exporters had been deprived of their own quota registered in the CPB. "They are also going to suffer production losses as many of them have already prepared their consignments according to their quota balance in the 338 category."

The Pak sea chief said the EPB was reluctant to give details of the quota allocated during this period. "We have asked the high-ups to give names and quantity of the quota given to the exporters on the basis of this policy, but so far they failed to give any positive response."