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All Pakistan Textile Mills Association (Aptma) Chairman M. Waqar Monnoo has refuted the misleading SOS message of the Pakistan Hosiery Manufacturers Association, the Pakistan Knitwears & Sweaters Exporters Association, the Pakistan Readymade Garments Manufacturers & Exporters Association, the Towel Manufacturers Association, and the Pakistan Cotton Fashion Apparel Manufacturers & Exporters Association published in the press on June 25, 2004.
He said there is no shortage of locally-manufactured yarn in the country for the value-added textile sector, adding the production of cotton yarn/mmf yarn is more than its requirement and substantial quantity of 1.55 million tonnes ie 75 percent of the total production of yarn is annually available for local consumption.
The Aptma chief dispelled the impression that hosiery or weaving yarn is short in supply, as abundant quantity is available on competitive rates, and any confusion on non-availability of required yarn being created by the value-added sector textile associations is false.
Waqar Monnoo also rebutted the impression being projected by the value-added sector that export of yarn is being made on lesser rates rather than selling locally.
He said the aggrieved value-added sector cannot give one good reason for exporting yarn at lower rates. He asked as to why spinning mills will sell at lower rates?
The Aptma chief firmly said there is no such set policy, and made it clear that spinning mills export yarn to foreign buyers against the letter of credit (L/C) at the best available price where payment is certain, as against most of the local dealings that are made on contract basis where payment is not definite and is mostly procured through agents on credit of longer periods, which is bound to cost more to the local consumers.
Waqar Monnoo said the importers have to pay sea freight, insurance, etc whose extra cost is not borne by local consumers.
He also said the spinning mills are operating under the same infrastructure as available to the value-added sector, therefore, the plea of the value-added sector textile associations that their competitors in the international markets have better infrastructure facilities and concessional tariffs is irrelevant as it is not on account of Aptma.
The Aptma chief advised the value-added sector to buy yarn directly from mills against local letter of credits, which definitely will cost them less.
Referring to the quality of yarn available for local consumption, Monnoo said the spinning mills are producing quality yarn both for knitting and the weaving from local and imported cotton, and there is no grievance in this regard from local consumers.
The Aptma chief said that figures of yarn consumption obtained from the office of the Textile Commissioner Office reflect an appreciable increase in consumption of the yarn by the value-added industry, adding that consumption increased by 9 percent in fiscal 2002-03 as compared to fiscal 2001-02.
He also said the increase in yarn prices was mainly on account of escalation in raw cotton and man-made fibres prices in local as well as international markets, adding the consumption of all fibres, including local and imported available to the spinning industry indicates that 75 percent of yarn production during the last five years was available to the value-added industry.
He said there has been growth in availability of yarn from 60 percent in 1993-94 to 75 percent in 2002-03, adding the export of yarn during this period appears to be stagnant despite a substantial increase in production of yarn due to industry expansion.
The Aptma chief held the view that if above textile associations are facing difficulties in the export of their products due to competitiveness of their products and need more facilitation/relief or require policy guidelines for the value-added sector in the post-quota scenario, they should not build up their case at the cost of yarn as it is one billion dollars export item and may approach the Government of Pakistan in the matter.
He was amazed to note that the Pakistan Hosiery Manufacturers Association is still agitating to restrict export of quality yarn, which they had earlier conceded in a meeting held at the in EPB on March 9, 2004 that it does not want any facility/concession on export of hosiery products by putting any kind of restriction on the export of yarn, but would ask the government to devise such policies that encourage export of value-added textiles, and not injure the export of other textile items in the regime of post-quota scenario.
Waqar Monnoo said that regime of free import/export policy has encouraged substantial investment in the textile sector, leading towards healthy growth in exports.
He warned that any diversion from the existing set and stable policy could result in vulnerability of the industry at different stages.
Concluding his statement, the Aptma chiefsaid that iii view of inevitable WTO regime in place from January 1, 2005, any intervention in the tariff rationalisation/ liberalisation would be detrimental to the vital interests vested in the textile industry, which is already struggling to remain competitive under post-ATC environment.-PR

Copyright Business Recorder, 2004

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