KARACHI, Sept 6: As business problems go on mounting with every passing day because of increase in energy tariff and dwindling foreign exchange reserves that has brought rupee-dollar parity close to Rs80 now, the business leaders believe that it may take at least one month after Asif Zardari’s election as president on Saturday to address their issues.

“Reshuffling of cabinet will perhaps be number one issue for the coalition government at centre and provinces,” a top business leader of a premier trade body says. After exit of PML (N) from the coalition in May, each minister in the PPP cabinet is now looking after several ministries.

A classic example is of Chaudhry Ahmad Mukhtar, who as defense minister has to offer explanations now almost on daily basis about US troops intrusion in Pakistani territories and killing of innocent civilians. He is also looking after commerce and textile affairs.

Chaudhry Mukhtar moved a summary for continuation of research and development (R&D) subsidy to textile exporters in the June meeting of the Economic Coordination Committee (ECC) during the current fiscal year.

A decision on this summary was deferred and textile exporters now complain that their claims for subsidy against shipments made in March, 2008 and onwards have not been paid.

Under the procedure, the exporter, after being informed of remittance of his proceeds after 90 days, has to obtain a certificate from his association and then submit an application to his banker, who then files a claim with the State Bank. “Obviously, the export proceeds of shipments made in March and onwards were received in July 2008 and after,’’ explained Javed Bilwani, the leader of Pakistan Hosiery Manufacturers Association (PHMA).

Iqbal Ibrahim, chairman of All Pakistan Textile Mills Association (Aptma) estimates a total sum of about Rs5 billion has apparently stuck up because of non-payment of export subsidy claims to textile business. “Cash flow is definitely a problem, but a bigger issue is that we have shown payments against these claims as receivables, which is not forthcoming in our 2007-08 balance sheets,’’ he said.

The State Bank initially stopped entertaining claims against those exports for which shipments were made after June 25. The government, however, restored the facility for exports made during June 25 till the end of month for payment of 2007-08 year. But this instruction also remains inoperative till this day.

“It is preventing us for booking export orders in 2008-09 because of doubts whether the research and development subsidy will be restored or not,’’ Shabir Ahmad, a leader of bedwear exporters said.

“When the subsidy facility process is in operation we offer a price to our buyers after making necessary adjustments with the expected claim payment,’’ he added.

A fall or more than 17 per cent in rupee dollar parity during last few weeks has helped textile business to maintain exports but the business leaders say that depreciation in rupee value has added to their production cost because of increase in import value of accessories that constitute almost 30 per cent of total product cost. Add to this, the rise in energy cost and the latest burden has come in the form of a huge rise in electricity tariff.

“About 100 textile units are being run on Wapda electricity,’’ the Aptma chairman said. These mills will be hardly able to keep their business run after this massive rise in electricity bill.

Textile business is, however, prepared to wait for a month so that the PPP brings its house in order after Saturday elections of Asif Zardari. Once the reshuffling process in the cabinet is complete and there are ministers with specific assignment, the textile leaders would be able to draw attention of the government and seek solution.