FAISALABAD: Textile exporters have suggested various measures to the government to tackle the current crisis of energy, issues of taxes, mark-up and exchange rates that will help double the export and fetch much-needed foreign exchange coupled with countless jobs in the textile sector.

The suggestions (a copy available with Dawn) have been forwarded by exporters after a detailed study by the Pakistan Textile Exporters Association.

Exporters said the country had been facing the energy crisis since last decade which was becoming severe with every passing year worsening the economy.

“The energy crisis has spillover impact on all sectors of Pakistan’s economy, posting negative effects on inflation, exchange rate, trade and businesses.

The energy shortage has pushed the textile sector into a crisis-like situation creating difficulties to fulfill export orders and most of the times exporters remain unable to ship consignments timely. Given circumstances are hitting textile exports inflicting colossal loss to the industry,” they said.

Exporters suggested that induction of LNG was a short-term solution to issues and in the long-term strategy the government should support textile sector with coal-based power generation plants on an equity basis to ensure constant energy at eight cents per unit in line with regional industrial tariffs against 16 cents per unit in Pakistan at present.

Coal plants will enable the industry to operate on 100pc capacity and help government shift excessive electricity to the national grid to decrease power shortfall.

The textile industry would become competitive not only within the country but also within the region and would also create 20pc new jobs, they said.

About the refund issues, exporters proposed to introduce the 2005 like policy of “no demand, no-refund.”

The zero-rating would end numerous complaints, irregularities and also bridle fake refund claims, they said and claimed the zero-rating brought fruitful results as textile exports gradually increased from $8.9 billion in 2004-05 to $13.78 billion in 2010-11.

As a result of withdrawal of zero-rating on the textile industry, huge amounts of textile exporters have been stuck up in refund regime creating severe liquidity crunch.

On the exchange rate issue, exporters said the recent rupee hike had a direct impact on export competitiveness of Pakistan, especially in the context of regional competition from textile export hubs.

Due to recent appreciation of Pakistan currency, textile exporters have to bear 30pc financial loss. The government has no policy to keep balance between currency exchange rate and the cost of doing business in Pakistan.

They recommended cost of doing business should be decreased according to a recent rupee hike. Subsidies should be provided on bank mark up, fuel prices and electricity to compensate the loss.

To absorb the unexpected shock, the government should allow at least 10pc rebate for textile exporters. In India and China, a rebate of 8pc had been provided to exporters to help them from financial loss in such circumstances.

Declaring the high mark-up rate a stumbling block in the way of investment, they said such rates were higher than regional rivals creating financial problems for textile exporters.

They suggested that the industrial mark-up rate should be according to the London interbank offered rate (Libor) and the government should make it equal to regional countries.

They said the low mark-up would attract new investments.