Bedwear exports have continuously been falling for the last three months (December to February) amid tough competition emerging from the newly-inducted members to the European Union (EU) belonging to former East European bloc. The latest export figures disclosed that export of bedwear during the month of February 2007 declined by 12.15% at $125,259 as against $143,727 recorded in the same month last year.

Similarly, there had been a fall of 5.29% to $1.263 billion during first eight months (July to February) of current fiscal compared to $1.334 billion exports achieved in the corresponding period last year.

There had been large scale relocation of textile units from Western Europe to former East European nations after getting membership in the EU, said Chairman, Pakistan Bedwear Exporters Association (PBEA), Shabir Ahmed.

He said the new members to the EU not only give the advantage of proximity of distance, but also offer cheap and productive labour. When we export goods from Pakistan to European countries, it takes around one month to reach its destination whereas it takes only two days by road from Eastern Europe to reach rich Western European nations. As a result of this, our exporters are also put at disadvantage on account of high freight charges as goods have to go from one continent to another.

Shabir Ahmed said that in this scenario, how our bedwear exporters could compete in a market where they have to face the burden in the shape of duties to the tune 16% (5.8% anti-dumping duty plus 10% customs duty). Other factors which are crippling our textile exports are high cost of inputs, including power, gas and labour charges. However, the high mark-up rates have further aggravated the situation for export trade.

Rs 29.761 billion tax relief package suggested

The Ministry of Textile Industry has recommended Rs 29.761 billion tax relief incentive package for revival of the textile sector. It has demanded duty free imports of garments/home textile sectors accessories, reduction of tax on power looms, inclusion of Polyester Staple Fiber (PSF) in Duty and Tax Remission for Export (DTRE) scheme and abolition of all direct and indirect Federal and Provincial levies on the exporters.

Out of 32 recommendations made in the Tariq Saeed Saigol report of National Textile Strategy Committee, the Textile Ministry has requested the Federal Government to give top priority to certain recommendations containing tax relief to the tune of Rs 29.761 billion.

TheTextile Ministry has recommended zero rating of all exports keeping in view the best international practices. It has recommended that import of accessories for the garment and home textile sectors should be made duty free. The financial impact would be around Rs 0.631 billion in case of few items only.