Govt Likely To Impose Tariff To Check Yarn Export

The government of Pakistan is forced to have a hard look at its "free import and free export" policy and is expected to consider of enforcing some sort of tariff or administrative measures to check yarn export due to the huge pressure from the domestic value-added sector on scarcity and rising prices of yarn.

A few associations of textile exporters have already demanded of the government to consider levying 10 per cent duty on yarn export. Alarmed on this orchestration of demand for restriction on yarn export, the big shots in spinning sector are mobilising their ranks and file again after finding that the new leadership of All Pakistan Textile Mills Association (Aptma) was unable to deal effectively with political power of the growers. "The Aptma leadership may prove to be as much ineffective against the leaders of value-added sector also," a leading spinner in Karachi expressed fears.

Even the officials have now brought down estimate of cotton crop from 10 million bales to 9.55 million bales and ginners believe that it may hardly be 9 million bales. The synthetic fibre sector has also taken advantage and increased the prices of polyester fibre which has raised the prices of man-made fibre also in the domestic market.

An increasing trend in yarn export has already been set in during the month of October. Market sources say that there is no respite in yarn export increase in November. The local value-added sector is literally starving of its input and reports suggest that if government fails to take any remedial measure, many small units of value-added textile may be closed down in coming weeks.

The government is expected to take a stock of textile industry''s situation at the end of December when cotton crop would have been picked and final figures of crop size would be available. The real impact of increasing prices of cotton and yarn on textile industry would be very clear then.