KARACHI, Sept 28: The government has decided to allow five per cent Research and Development (R&D) support to home textiles across the board by withdrawing its earlier condition of having in-house dyeing, processing and printing facility for availing the facility.
The decision was taken in the Economic Coordination Committee (ECC) meeting on Wednesday.
As a result of this decision all home textiles products, including towels and bedwear will now be eligible to avail five per cent R&D support irrespective of having in-house dyeing, printing and processing facilities or not.
About two months back the ministry of textile industry had announced a textile package of Rs22 to Rs25 billion to give some relief through R&D support to the exporters of textiles, which had been facing tough competition in the world market.
However, the ministry laid down a condition that only those manufacturers-cum-exporters would get 5 per cent R&D support who would have in-house facility of dyeing, processing and printing.
This invited strong reaction from a large segment of textile industry which did not have in-house facility of printing, dyeing and processing and mostly met their requirements through outsourcing.
Strong arguments were put forward by those who were deprived of the R&D support. Several meetings were held with Minister of Textile Industry Mushtaq Ali Cheema but only promises were made.
However, on the advice of Prime Minister Shaukat Aziz the issue was referred to Dr Salman Shah, adviser to the prime minister on Finance. Besides, several meetings were also held with Minister of Commerce Humayoun Akhtar Khan, Minister of Industries Jahangir Tareen and Chairman CBR Abdullah Yousuf.
As a result of these efforts a summary was prepared by the Dr Salman Shah, which was presented to the ECC meeting held on Wednesday, and an approval was given for allowing 5 per cent R&D rebate to the home textiles across the board.
The Pakistan Bedwear Exporters Association (PBEA) Chairman Shabir Ahmed welcoming the decision said on Thursday that in the first place the rebate should had been allowed across the board when the ministry of commerce had announced six per cent R&D rebate on the export of readymade garments a year ago.
The country’s exports are facing tough competition in the world market and according to the rules any person involved in export trade should had got the R&D support and not only a few units. It was totally a discriminatory decision of the ministry of textile industry to allow R&D rebate to a few units, which was in favour of a few persons.
A committee set up by the ministry of textile industry under the chairmanship of Zubair Motiwala in its meeting had also recommended the R&D support across the board for the textile exporters.
