May 03, 2007	Thursday	Rabi-us-Sani 15, 1428

LAHORE, May 2: The All-Pakistan Textile Mills Association (Aptma) has claimed that its members have closed down approximately 500,000 spindles during the last one year, out of a total industrial capacity of around 11.5 million spindles.

The claim was made by Aptma chairman Shafqat Elahi at a press conference in which he spoke about current situation of country’s textile industry.

He declined to say as to which units have closed down operations or slashed their production despite repeated questions.

He said he did not want to put his members in any trouble by naming them.

“You know a number of issues are involved in it. If I give you names, banks and creditors will start hounding them, with various government agencies collecting various labour levies from the industry,” he said.

He also could not establish any link between the quantity of yarn produced and the number of spindles, which he claimed have gone out of production system.

Punjab Aptma chairman Samir Saigol intervened to say that the impact of such a large number of spindles going out of the production would become visible after some time.

He said that the closure of several units and reduction in the number of operational spindles had resulted in the loss of 15,000 jobs.

“If the industry is not given the level playing field, vis-à-vis its regional competitors, like India, China, Bangladesh, etc., and if the government fails to zero-rate textile exports and implement its stated policies, more closures would be imminent. It will result in bank defaults and more job losses,” he warned.

He said the government must act immediately to zero-rate taxes and levies on the textile industry to reduce the cost of doing business.

“We do not want any subsidy from the government. The only thing we want is fair implementation of its earlier stated polices,” he said.

Mr Elahi urged the government to allow import of cotton from India from all entry points, including Wagha, and for including import of polyester fibre under the duties and taxes remission for exports (DTRE) scheme.

"Internal factors, like inflationary cost pressures, indirect taxes and inefficient ports and inland transport, and external factors, like subsidies and support provided by Indians and Chinese to their respective textile industries, have led to an unbearable increase in the cost of production," he said, adding the textile industry's costs were now out of line by 10-15 per cent.

He said it was becoming more and more difficult for the industry to compete in the world market.

Pakistan’s textile exports have increased by seven per cent in the first three quarters of the current fiscal year.

“This is very unimpressive given the strength of our industry. We can raise our share in the world markets manifold, if we are allowed a level-playing field by the government,” the chairman said.

He said the 140pc increase in bank interest rates had curbed the import of textile machinery down by 38pc, and it was the reason that the industry was reluctant to make further investment.

He said China offered a great potential for basic textile industry.

“After July 2008, only Pakistan shall have free market access to China. That scenario offers a huge potential for basic textile exports to China from Pakistan.

“We need to increase our capacity to meet that challenge and not force its closure due to short-sighted policies,” he said.