Pakistani finance minister Ishaq Dar has announced a few sops for the country’s beleaguered textile sector in the budget for 2015-16.
“Textiles industry is the mainstay of Pakistan’s economy. It accounts for more than 50 per cent of our exports value and is the single largest employment provider in the manufacturing sector,” Dar said in his budget speech.
Under the textiles policy 2014-19 financial package of PK Rs 64.15 billion ($0.63 billion) has been approved in order to double the textiles exports and create three million additional jobs by the year 2019.
He also announced the restructuring of the Federal Textile Board with majority members from the private sector to resolve the various issues pertaining to textile sector and for implementation of textiles policy 2014-19.
The benefit of drawback of local taxes and levies scheme shall remain available for the textile exporter in the FY 2015-16 under which they shall be entitled to the drawback on FOB values of their enhanced exports if increased beyond 10 per cent of their previous year’s exports. Nder the scheme, garments will be entitled to 4 drawback, made-ups 2 per while processed fabric will be entitled to 1 per cent.
From July 1, 2015, export refinance facility and long term finance facility will be available for textile-exporters at the lowest rate ever — at 4.5 per cent and 6 per cent respectively. The custom duty on import of textile machinery under SRO 809 will be zero for 2015-16 as well.
In order to facilitate and incentivise the investments in plants and machinery, technology up-gradation fund scheme will be launched in 2015-16, as per the provisions of textiles policy 2014-19.
Dar said the spadework has been completed on a mega project worth Rs 4.4 billion for training of 120,000 unskilled men and women over a period of 5 year. This scheme shall be launched in FY 2015-16.
Dar said Pakistan’s economic growth during 2014-15 has been provisionally recorded at 4.24 per cent compared to the revised estimate of 4.03 per cent last year,
Pakistan’s textiles exports have been falling recently and exporters have blamed the government for energy shortage, taxation hassles and rising input costs for their woes,