The All Pakistan Textile Mills Association believes export proceeds of the textile sector will go down by up to $3 billion in the current fiscal year because of the government’s policies that have “strangulated” the largest dollar-earning sector of the economy. Shortage of gas supply, increased energy tariffs, super tax, and other issues are a huge concern for the textile sector, and the government is busy fighting for power instead of helping the most crucial textile sector of this country which is the backbone of the country’s GDP.
Shahid Sattar, Aptma Secretary General, said, “I cannot see (us) getting out of this perfect storm… It would be a miracle if we can retain our exports at the current level. The textile sector performed “pretty well” in the last two years as its foreign earnings increased by roughly $7bn. Exporters are facing huge issues in financing the export cycle, which lasts four to six months, and you need double the amount of currency now to finance that cycle. You collect Rs300-350bn a year, retain up to Rs60bn (and refund the rest). This has soaked up liquidity. The Export Finance Scheme just does not cover the lack of working capital. How can our exports grow if we do not have working capital?”
Sattar criticized the government for failing to supply gas and electricity to the textile units that have been either upgraded or built new using the subsidized loans under the Temporary Economic Refinance Facility (TERF).
