LAHORE: All Pakistan Textile Mills Association (Aptma) has said that textile producers have started closing down their units or are operating just two shifts because they are unable to sell their products on the world markets due to higher cost of production.

Speaking at a news conference on Friday, Aptma Chairman S.M. Tanveer called upon the government to cut the high cost of doing business that has led to shutdown of more than one-third of the installed capacity.

Textiles producers say exporters are forced to pay “innovative taxes” equal to over 12 per cent, collectively around $1.2 billion, of their turnover in different forms, thus eroding the economic viability and international competitiveness of the industry.

“Our member mills are pushing us to go on strike. So far, we have persuaded them to avoid taking such an extreme step. But for how long?,” he said.

“We cannot continue to operate in the present circumstances for very long,” he said.

He warned that the value-added sector would soon follow the textile sector, as it would be starved of yarn and fabric when present stocks exhaust.

“Our foreign buyers are shifting to cheaper suppliers from rival economies like India as they refuse to share the burden of new taxes on power and energy in Pakistan,” he said.

He said the government had cornered the industry further by slapping 5pc sales taxes on non-registered buyers of yarn and fabric in the new budget that the exporters have to pay. He said this sales tax was nonrefundable even to exporters.

Published in Dawn, July 4th, 2015

On a mobile phone? Get the Dawn Mobile App: Apple Store | Google Play