Page 64 - TEXtalks March/April 2022

64 Textiles and Apparel Policy 65 Commerce and Finance Division. collaborati

Commerce wi
Reports 2020-25 An export target The industrials are praising that DLTL/DDT scheme however,
considered.
will be continued for exports of value-added
be constitu
products only, i.e., technical textiles, apparel,
other natur
made-ups, and carpets. Ministry of Commerce will
of 40 Billion
chain. Till
further pursue SBP and FBR to automate the
zero import
schemes on the lines of custom duty drawback
$US in FY disbursements process of the duty drawback and semi-pr
mechanism where payments are made directly to
man-made fi
filament-ba
exporter accounts by SBP on receipts of foreign
The Pakistani government has approved the the Finance Division would necessarily be required to exchange for notified products exported, subject to to the
much-awaited pro-industry Textiles and Apparel keep intact the due support on proposed 2021-25 allocation of funds by the Ministry of Finance. The drawba
Policy (TAP) 2020-25, which aims to achieve the interventions throughout the policy years to achieve textile sector's progress is related to the smooth rationa
target of US$ 40 billion for textile exports by 2025. set milestones. As the TAP 2020-25 has increased operations of the allied industries. The textiles and for
China's global market for textile exports is dominated the expectations from the textile sector, it has also apparel industry has become Pakistan's single in fiber/ f
by a 32% share of textile trade of $302 billion. highlighted some strategies to achieve those targets, largest manufacturing sector. However,
Pakistan's share is only 1.6% in the global textile including: manufacturing industries could not be developed 4. Human R
trade, targeted at 3% over the next five years. Under proportionally, textiles and apparel machinery, dyes HR de
the textile policy, the formation of Specialized 1. Capacity Building LTFF and EFS and chemicals, spare parts, and accessories. Most lacks. T
Economic Zones (SEZs) will be ensured to accelerate Capacity building is one of the crucial strategies used of the demands in these areas are managed through and TEVT
exports by providing Plug and Play facilities, to develop any country/firm. In TAP 2020-25, imports. Ministry of Commerce will provide mass level
especially for garment units. The textile and clothing particular emphasis has been given to capacity rates will be appropriate incentives to strengthen the allied value-chai
industry in Pakistan is of significant importance to the building for technology, infrastructure, small and industries to ensure indigenous supply of machinery import
country's economy. Textile and clothing exports medium enterprises, marketing, product and materials at competitive prices. apparel ins
account for over 61% of Pakistan's total exports, and diversification towards technical textiles, International continued at 5% particular
the industry provides direct employment for about and National Regulatory Regimes, and R&D. The Under the newly placed mechanism to link provisions empowe
40% of the country's total industrial workforce. The strengthening of small and medium enterprises of energy supplies for textile exports with
industry also provides support for over 10 million (SMEs) has been considered as in important aspect and 3%, in diversifying the fiber and product mix and facilitate the textiles and apparel sector. However, it has not international competitive prices, the government has 5. Ot
farming families. in the policy. The most prominent step government in introducing high value-added and technical brought much investment, suggesting that long-term extended guarantees for continuous provisions of The Minis
will take to boost value-added exports is to allow textile-based products. profitability needs to be restored to attract gas and electricity at "internationally and regionally Dis
TAP 2020-25 has shown a holistic approach to tackle back-to-back LCs, and this would be the basis for respectively, investment, especially SMEs. Tariffs have been kept competitive prices" from the next budget 2022-23 trade dis
issues confronting the textiles and apparel sector development and provide a launching pad to SMEs. Although traditional textiles and apparel business high to encourage investment in the upstream value instead of supplying at existing fixed rates. It Moreover,
amid COVID-19 that has resulted in supply chain A special focus has been dedicated to enhancing the has been increasing, technical textile is an area chain. Nevertheless, high tariffs encourage domestic indicates that gas and electricity prices for the textile
disruptions and affected global prices of marketing aspects by providing help in exhibitions, during FY where research and development are important. sales, and pricing induces inefficiencies. sector may be revised upward from the next fiscal associat
commodities and trade adversely, and addressed e-commerce, digital marketing, market access, Pakistan can attract investment and gain a Furthermore, the rationalization of the Taxation Regime year 2022-23 starting from July 1, 2022. Now the disputes.
withdrawal of SRO-1125 and cost of doing business international buying houses, and promoting the reasonable share in global markets. Ministry of is also a promising move in the revised policy. rates of gas and electricity will be fixed on an strengthe
related matters. Furthermore, the Policy would attract country's right image. The textile sector has 2021-22 Commerce will include technical textiles and annualized basis to align them with competitive Commerce w
domestic and foreign investments in textiles and welcomed the Policy, and they are hopeful that it will value-added products in DLTL/DDT schemes to Energy (Electricity and RLNG) will be provided to the international prices on the occasion of every budget stren
apparel supply-chain and development of bring a positive change for the textile sector and the encourage manufacturing and exports. Further, the export-oriented units/sectors of the textiles and announcement. association
value-added sectors, with a prime focus on SMEs. country. Thus, stakeholders are asking for the speedy Ministry will constitute a focus group comprising apparel industry at regionally competitive rates promote tec
implementation of the Textile and Apparel Policy academia and manufacturers to formulate a strategy throughout the policy years. The Ministry of 3. Strengthening of Textiles and Apparel Value quality, so
Ministry of Commerce has undertaken an exercise of 2020/25 to reach the export targets. and propose measures to introduce the fourth Commerce will conduct an exercise jointly with the Chain- Sector Specific Initiatives and market
thorough consultations with private stakeholders and Generation Industrial Revolution in the textiles and Ministry of Energy (Power and Petroleum Divisions) As Cotton remains the mainstay and significant sustainabil
proposed to set an export target of US$ 20 billion for For researchers seeking funding for the development apparel industry. and the Finance Division during pre-budget comparative advantage of textiles and apparel value reduct
the textiles and apparel industry during FY 2021-22. of the textile sector, there is good news regarding the 2. Reduce Cost of Doing Business consultative sessions annually to review the energy chain, the Ministry of Commerce will attract digitalizat
The Prime Minister has also approved the initiation of new research funding. Earlier, most Pakistan is considered one of the countries with a tariffs. The rates may be revised on an average of international and domestic seed companies to resource de
afore-mentioned target. The export target for FY research depended on grants from Higher Education low cost of doing business. However, the energy prices for industrial consumers of regional introduce the latest seed technology in Pakistan. An empow
2021-22 is further cascaded till FY 2024-25 with a Commission which involves a bureaucratic process government plans to reduce further the cost of doing competitors and announced in the Federal Budget increase in yield will also address the issue of responsib
projection to double textiles and apparel exports to and limited funds and further takes enough time for business to strengthen the textile sector and along-with budgetary allocations by Finance Division profitability in Cotton farming. Another initiative that
US$ 40 billion. However, long-term commitments approval and implementation. Ministry of Commerce business community further. The manufacturing as required by the Ministry of Energy so that energy can stabilize Cotton prices will be the re-introduction 6.
from the Federal Government, robust implementation will establish a research and product development industry in Pakistan has been complaining about subsidy would remain fully funded throughout the of Cotton Hedge Trading to facilitate farmer and Textile D
of policy interventions by relevant ministries/divisions fund to introduce new products and improve the un-competitiveness vis-à-vis competing countries. policy years. For the captive and the cogeneration value-added exporters. This model has successfully Divisio
departments, and complete financial support from quality of existing products. This would also facilitate units, a separate policy will be made by the Ministry been operating in other countries. The previous among vari
Recently government extended much facilitation to of Energy, consultation with the Ministry of Policy was intended to reintroduce Hedge Trading in Commit

March/April 2022 March/April 2022