ISLAMABAD: The National Assembly’s Standing Committee on Finance on Wednesday supported the proposal by the textile sector to restructure bank loans of sick units to help their revival.

Members of the textile sector informed the committee that the revival of sick units will earn $1 billion in foreign exchange and create five million jobs.

Committee chairman Qaiser Ahmed Sheikh noted that exports have declined from $25bn to $20bn in the last four years and the decrease will continue if its basic causes are not addressed.

The representatives of the textile sector identified a high cost of LNG, non-clearance of refunds and government borrowing by banks as major causes that led to the decline in exports.

Committee members noted that the government borrows heavily from banks and leaves no space for the private sector to obtain loans.

The meeting was also informed that exports from Bangladesh have increased from $24bn to $34bn.

Federal Board of Revenue (FBR) Chairman Dr Muhammad Irshad said the government is revamping the regulatory duties (RDs) system in consultation with all stakeholders following complaints that RDs on steel and paper items were making them uncompetitive.

While considering the matter of the import and manufacturing of phthalic anhydride, Mr Sheikh left the chair for Daniyal Aziz to avoid conflict of interest. Mr Sheikh is one of the stakeholders in the case.

The case is related to the demand by several sectors to reduce import duties on phthalic anhydride, a basic raw material for plastic products, from 11pc to 5pc.

Anjum Nisar, who represented the only phthalic anhydride producer in the country, said the import duty should be 16pc instead of 11pc, as its imports hurt his company’s investments.

However, Mr Nisar failed to convince MNAs belonging to different political parties who asked him about the production capacity and duty structures.

“Phthalic anhydride is made from chemicals imported at 3pc while the import duty on phthalic anhydride itself is 11pc. There is a difference of 8pc in your favour,” committee member Asad Umar said.

Mustafa Mehmood of PPP said further increasing the import duty on phthalic anhydride will create monopoly, distorting the country’s industrial base.

Published in Dawn, April 27th, 2017