KARACHI, Jan 14: The Quota Supervisory Council (QSC) has asked the Ministry of Commerce (MoC) not to allow the transfer of quota obtained by exporters through auction during quota year 2004. However, the QSC further suggested to the MoC that all the flexibility quotas, including swing, shift, carryover and carry forward should be made transferable. But if over-programming was allowed, it should not be made transferable.
These and other suggestions were made by the QSC in its fourth meeting held recently with Aziz Memon, chairman QSC, in the chair. These recommendations are being given by the Council to be included in the SRO 2004 of the textile quota.
It was further recommended to the MoC that the balance, if any, against the deductions made from 2003 performance quota in some categories by the EPB on account of over-shipment made in 2002, should be released in 2004.
The QSC, which represents exporters in quota management and has only a consultative role also suggested that the security deposit collected against carry-over quantity from exporters should be refunded at the end of 2004 because quotas are being removed from 2005, which means exporters will not avail carry-over quota.
As the quotas are coming to an end from January 1, 2005, exporters would not be able to avail carry-forward quota, therefore, the QSC has asked the MoC to give quota across-the- board equal to what their carry forward entitlement would have been for the year 2004.
Exporters normally have had the facility of availing carry- forward from their next year's quota. No performance is allowed in the following year against this and additionally the quantity is deducted from performance as having been utilized in advance.
This deduction reduces the shippable balance in exporter's hand. However, exporters are able to make this up by availing carry-forward from the following year. As quota is being removed from 2005 it will not be possible for exporters to avail carry forward.
The participants of the meeting noted that the MoC usually allows over-programming (OP) - it may consider that this carry forward is in lieu of quantity usually released as OP and it may hold up OP which may be allowed subsequently only if conditions permit. Alternatively, some quantity may be withheld from the growth quota for release as carry-forward.
They also suggested that in case the MoC is able to get any quantity for carry-forward from the WTO or EU in view of the special circumstances, the same may be retained by the Ministry and its distribution determined then in consultation with the QSC.
The QSC wants the MoC to distribute the balance growth quota on the basis of 50 per cent allocated to performance holders and 50 per cent to be released on FCFS basis and on usual terms.
For the resolution of audit memos the QSC recommended that such cases where minor procedural discrepancies or differences in value have been pointed out the same memos may be resolved at the level of the director TQMD.
All other memos may be referred to a committee comprising the chairman QSC, member audit QSC, vice chairman EPB and director general (Textiles) EPB. In case any such memo remains outstanding for more than 30 days then quota service of that exporter may be immediately suspended till the memos' resolution as per the committee's decision.
The QSC wants the MoC to immediately take up the matter with the EU with regard to invoking exceptional flexibility and same should be distributed to exporters at the first opportunity. It also asked the Ministry to take the QSC into confidence before implementing any policy.