April 27, 2008	Sunday	Rabi-us-Sani 20, 1429

KARACHI, April 26: A US-based company of the Indian origin has stopped making payments against imports of home textiles from Pakistan, which is resulting in heavy losses to exporters.

Over 400 containers loaded with home textile goods are presently stuck at US ports owing to non-clearance by the importing company, Dan River, which has filed for Chapter 11 bankruptcy.

Export consignments worth over $30 million from around 24 Pakistani exporters are at stake because home textiles worth $20 million are stuck at US ports, and goods worth around $10 million are on their way.

This was stated by business leaders of home textiles at a press conference, organised by the Pakistan Towel Manufacturers (TMA), here on Saturday.

According to exporters, the Indian parent company, Gujarat Heavy Chemicals Ltd (GHCL), through their local agents, had given an assurance at the time of shipment that payments for shipment would be made as per agreed terms and conditions.

However, so far there had been no payment for the last four months and most of the shipments are stuck at the US ports.

The affected exporters appealed to the government to intervene and take up the matter with the Pakistani High Commission in New Delhi and the Indian High Commission in Islamabad.

They also asked the government to instruct the Pakistani embassy in the US to take up the issue with US customs so that the merchandise are not frustrated and cause huge demurrage.

This blow to Pakistani exporters came at a time when textile exports are rapidly falling due to tough competition in the world market.

In order to retain their market share after the end of quota on textiles, exporters under tremendous pressure are also compelled to sell on credit.The affected exporters who spoke on the occasion included S M Obaid, Naqi Bari, Muzzammil Husain, Saleem Dalal, Zahid Maqbool, Feroze Alam Lari, Nisar Palla, Ashraf Mukati and Shoaib Majeed.

The exporters also urged the State Bank of Pakistan to take a lenient view in the repatriation of export proceeds against such exports because the default was on the part of the importer.

They said that since the company had gone bankrupt, $15 to $20 million would not be remitted to Pakistan.

They also asked the SBP to convert the refinance taken against their post-shipment into loans payable in rupees (rather than in dollars) because it had already caused heavy financial loss to exporters.