ISLAMABAD: After slashing the prices of petroleum products, newly appointed Finance Minister Ishaq Dar may take another decision and consider a hefty package of subsidies on energy for the textile sector to help it compete with regional countries.

The decision is expected during a meeting between the minister and textile exporters on Thursday, Pakistan Textile Exporters Association’s (PTEA) patron-in-chief Khurram Mukhtar told Dawn on Monday. “Finance Minister Ishaq Dar called PTEA for a meeting concerning energy tariff,” he said.

Since July this year, the PTEA held three meetings with former finance minister Miftah Ismail to sensitise the government about the rising energy cost in the country which rendered textile exports less competitive in comparison with the regional countries.

In the budget for fiscal year 2022-23, the government has set aside Rs20 billion as subsidy on electricity for the export sector and another Rs40bn on gas supply to the industrial sector.

“We want some practical mechanism to make the textile sector more competitive,” Mr Khurram said.

A regionally competitive tariff was given to the textile sector in December 2015, he said, adding that the PTEA had pleaded the case for the entire textile value chain and accordingly the then government recommended $1.20 per mmBtu subsidy on gas which was later extended to all the exports sector.

“It took us at least four years to gain back share in the global textile market,” Mr Khurram said. “There is a huge opportunity for the textile exporters to increase the volume of country’s exports to $35 billion over the next five years, subject to remaining competitive.”

Following the devastating monsoon rain hitting cotton areas, the PTEA has approached the federal government, asking the latter to allow the import of cotton from India via the Wagah border to meet the rising export orders.

Exporters say early estimates show that 25 per cent of the standing cotton crop have been damaged and there is a possibility of a raw material shortage in the country.

“We may need to import 2.5 million bales of cotton from India,” Mr Khurram said, adding that it seemed to be the only viable option with lower logistics costs.

In the first two months of the current fiscal year, the textile group posted a paltry growth of 4.18pc compared to the same period a year ago. In August, the growth of the textile group was over 7pc, indicating hopes for a revival of exports from the country.

Published in Dawn, October 4th, 2022

Now you can follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Back to politics
Updated 29 Nov, 2022

Back to politics

PDM and PTI must realise that neither will get what they want if they keep fighting bitterly at every turn.
Election delay
29 Nov, 2022

Election delay

OF recent, leaders from the ruling PML-N have been dropping hints about a possible delay in general elections after...
Sugar woes
29 Nov, 2022

Sugar woes

IT’S that time of year again when cane growers get anxious over the delay in the commencement of the new sugar...
1971 in retrospect
Updated 28 Nov, 2022

1971 in retrospect

The point of no return came when the military launched Operation Searchlight in March 1971.
Gender-based violence
28 Nov, 2022

Gender-based violence

IT is a war without boundaries and seemingly without end. A UN report on femicide released on Nov 25, the...
Battle against dacoits
28 Nov, 2022

Battle against dacoits

THE Punjab police is clearly fighting a formidable, and so far losing, battle against the criminal gangs based in ...