KARACHI, Oct 20: Textile ancillary industry has asked the government to immediately impose ban on yarn export to protect value-added textile goods export and avoid large-scale unemployment in the industry.
The flare-up in raw cotton prices has already pushed cotton yarn prices high in the local market and if no immediate remedial measures are taken the value-added textile industry would come to a standstill, exporters said.
“Instead of imposing ban on raw cotton export the government should immediately come out to save the ancillary industry, which provides large-scale employment and also fetches sufficient foreign exchange on exports,” a leading bedlinen exporter said.
When free trade policy on raw cotton had been successfully working for the last three years and there was no restriction of any sort on its import the spinners could easily meet their shortfall through imports, another exporter said.
Exporters of value-added textiles say that they generally book their export contracts well in advance and their valuation and pricing quoted for the buyers are based on rates prevalent at that time. However, after a sudden rise in cotton yarn prices in the local market their products became uncompetitive in the world market and many exporters fear that their export contracts worth millions of dollars may be cancelled by their buyers.
Former Pakistan Bedwear Exporters Association (PBEA) chairman Shabir Ahmed said that there could be some damage caused to cotton crop by pests attack but the situation would not have been so bad as of today had the government responded timely by protecting cotton trade from speculators and investors.
He said it was an open fact that presently there was an access liquidity in the money market and with the interest rates touching all time low the investors were looking for every opportunities to invest and speculate in any trade.
Shabir Ahmed said that first came the real estate followed by boom in the capital market, and then textile quotas and now raw cotton trade. All these trades, he said, had suffered at the hands of speculators who made quick money at the cost of genuine trade.
However, he said the textile ancillary industry would like to know what the ministries — finance, commerce and agriculture — are doing. Are they silent spectators who have no interest in the country’s economy, particularly cotton on which stakes are very high?
It is a national crisis and there was urgent need for calling an emergent meeting of all the ministries concerned with the textile industry to find a way out from the present impasse, he added.
Pakistan Readymade Garments Manufacturers and Exporters Association chairman Tahir Aziz said yarn prices had gone up by 10-15 per cent in the domestic market and “our exports are becoming uncompetitive in the world market”.
He said that instead of imposing ban on cotton exports the government should immediately impose ban on cotton yarn exports to save value-added textile industry from total collapse.
Dr Khurram Tariq, chairman of the Pakistan Hosiery Manufacturers Association, said the situation was so bad that the government should act immediately.