KARACHI: All-Pakistan Textile Mills Association chairman Mohammad Yasin Siddik on Wednesday urged the government to resolve the energy crisis as it was having a negative impact on the textile industry.
Speaking to newsmen at the Aptma office, he said if the government did not take corrective measures, the situation would worsen and textile units would suffer more.
He said that around one million spindles have closed down owing to energy crisis and high cost of doing business.
Giving details, the Aptma chief said that during the last two months alone, around 892,839 spindles were shut down in Punjab and 73,380 spindles in Sindh.
He further said that since the industry in Punjab is running only two shifts instead of three, the cost of doing business increases and this threatens the viability of the industry.
Mr Siddik said that huge funds of around Rs30 billion belonging to textile industry alone in sales tax refunds are stuck up with the Federal Board of Revenue (FBR) and this is also having a financial cost of up to 1 per cent on industry’s total turnover.
Under the Textile Policy 2009, the government was supposed to bear up to 50pc of markup towards technological up-gradation of the industry, but the same was not being honoured. Therefore, if all these factors are added, they have a negative impact of 26pc on domestic industry against neighbouring countries where other benefits are also given.
He said that in India the central government gives 6pc rebate on exports and to attract investment most of the state governments give 5pc subsidy on markup to industry.