• Friday, September 20, 2019

All Pakistan Textile Mills Association announces closure of 200 mills from tomorrow

Discussion in 'Pakistan Economy' started by Devil Soul, Jun 30, 2019.

  1. Devil Soul

    Devil Soul ELITE MEMBER

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    APTMA announces closure of 200 mills from tomorrow, as buyers cancel export orders

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    KARACHI: The All Pakistan Textile Mills Association (APTMA) has announced closure of 200 of its processing mills from Monday, July 1, as international buyers rejected export deliveries of the mills due to price increase.

    APTMA in a press statement said a meeting of around 200 mills was held in Karachi on Saturday, where members said that their buyers had refused to pay the new prices for their orders. Thus, the millers had decided to shut down their operations from the first day of the new fiscal year.

    Earlier, APTMA Sindh-Balochistan Region Chairman Zahid Mazhar had said that an increase in gas tariff by 31 percent was the last nail in the coffin of the general industry and the textile industry in particular.

    He said the textile sector was already facing unbearable costs of manufacturing, which were very high as compared to the regional competitors.

    Due to the high cost of doing business, inadequate supply of raw material, drastic increase in interest rate, and liquidity constraints due to the delay in refunds of sales tax, almost 140 textile mills had already closed their operations.

    That he said resulted in about a million workers losing their jobs. “Around 75 to 80 mills are on the verge of closure, which will add to the unemployment figures by another 0.5 million workers employed in the textile industry,” he added.

    Speaking about the removal of the zero-rating facility for the five exporting industries, Mazhar said the textile sector had not yet come out of the shock of the government’s adverse decision to withdraw the zero-rated facility.

    In Federal Budget 2019-20, the government decided to withdraw the statutory regulatory order 1125(I)/2011, which allowed zer-rated sales tax on inputs and products for the five major export-oriented sectors – textile, leather, carpets, sports goods, and surgical instruments.

    He said that as if that was not enough, the government was going to hit the industry with another blow in the shape of increased gas tariff.

    He said the gas tariff for industry in Bangladesh was $3.0/MMBTU, which was more than 50 percent cheaper than Pakistan.

    He further said that due to the closure of about 140 mills, and the mills operating under capacity, Pakistan’s textile exports were suffering an opportunity loss of more than $4.0 billion per annum.

    APTMA Sindh-Balochistan Region chairman demanded the government to save the export-oriented textile industry and Pakistan from complete disaster by not increasing the gas prices.

    He also asked the government to instruct the gas utility companies to meet their revenue requirements by strictly following the UFG benchmark in accordance with the international best practices, and reducing other expenses with better management.

    Last week, the Economic Coordination Committee (ECC) of the Cabinet approved the decision to increase the gas tariff by 31 percent for the general industry, power plants, cement, and fertiliser, etc.

    The new tariff would be enforced from today, as was agreed with the IMF. Consumers of gas would be paying up an additional Rs170 billion, including the increased in GST
    https://www.thenews.com.pk/print/49...-from-tomorrow-as-buyers-cancel-export-orders
     
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  2. Salza

    Salza SENIOR MEMBER

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    They are lieing.. Blackmailing tactics to the govt
     
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  3. Alternatiiv

    Alternatiiv SENIOR MEMBER

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    What the hell? Of course devaluation, gas and oil price hike, more and more taxes, are putting businesses on the edge, they have to increase their prices to account for the expenses and that makes it harder for them to compete in the International market. This is very bad news, textile is one of the most major export products. This is not blackmailing.

    It was known from first day what effect this will have. Businesses will profit less, many will close down, the loans will increase many folds since revenue generation is in Rupees and payment is in USD, the buying power of people will decrease, we put a gun shot in our own leg and hurt our industry badly.
     
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  4. maithil

    maithil FULL MEMBER

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    What did govt expect ? Increase in gas and electricity tariff and almost doubling of interest will not have any impact? Rejoice Pakistan. Tabdeeli is here to stay.
     
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  5. Abu Shaleh Rumi

    Abu Shaleh Rumi FULL MEMBER

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    You guys are welcome to setup your shops here in Bangladesh broz. We do have some red tape issue, but you can make handsome profits and settle in our safer, greener environment... :enjoy:
     
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  6. Salza

    Salza SENIOR MEMBER

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    Govt has already given so many concessions to these exporters yet they want more. Go and check the list of subsidiaries these people are enjoying than post.
     
    Last edited by a moderator: Jul 1, 2019
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  7. Retired Troll

    Retired Troll BANNED

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    These are all corrupt people who in cahoots with capitalist Mafia.

    Those who are unemployed by this should contact Faisal Wowda. That man is handing out halal jobs in Pakistan
     
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  8. Dubious

    Dubious MODERATOR

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    I might say the same to you for this

     
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  9. Dubious

    Dubious MODERATOR

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    Why is this? And this is not new! It has been the case forever now! Most of our own opened their shops in BD!
     
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  10. Salza

    Salza SENIOR MEMBER

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    They failed to increase Pakistan exports despite of heavy subsidiaries and now crying when govt started to demand some taxes from them.
     
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  11. Dubious

    Dubious MODERATOR

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    Thats the problem almost every other sector in Pakistan is used to hand me outs! Why cant any man stand on their own? We are 70+ yrs old for godsake!
     
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  12. FuturePAF

    FuturePAF FULL MEMBER

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    Who are the buyers? Domestic consumers will see a higher price relative to the devalued Rupee and new taxes, but export markets pay in dollars, euros, and yuan. How competitive are Pakistani industries on a price basis when exporting?
     
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  13. Retired Troll

    Retired Troll BANNED

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    for the Amount of indirect taxes Pakistani pays. modern socialist structure can be given.

    please dont blame majboor awaam. blame majboor hukumraan
     
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  14. 313ghazi

    313ghazi SENIOR MEMBER

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    Learn to code.

    Life is tough - if you cannot survive in the free market that's too bad. Government has no role propping up private businesses.
     
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  15. Salza

    Salza SENIOR MEMBER

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    Current account deficit going down solely because of govt effort by going hard on imports though on principle, should had gone down because of exports.
     
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