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Indian minister arriving later this week: Aptma against inclusion of PSF in negative list

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Economic Updates - Pak Major Financial News

The All Pakistan Textile Manufacturers Association (Aptma) has urged the Commerce Ministry not to include polyester staple fibre (PSF) in the negative list being finalised with India.

Indian Minister for Commerce and Industry is reaching Pakistan at the end of current week to normalise trade relations.

"We have written a letter to the Commerce Ministry, requesting that PSF (PCT 5503.2010) should not be included in the proposed negative list of items, and thus be made freely importable from India.

Our request is well-reasoned and justified," said an Aptma member.

According to the Association, there is an acute domestic shortfall of PSF on account of the 240,900 tons capacity at Dewan Salman Fibre, the largest PSF manufacturer.PSF is a basic raw material for the export-oriented textile industry.

The PSF, imported from India, would be used for the value-addition that is carried out in Pakistan for re-export and would bring valuable foreign exchange to Pakistan.

A moratorium on PSF import from India by its inclusion in the negative list would have restrictive effect on all synthetic oriented downstream activities from yarn to made-ups, including cloth and fabrics."In view of the large domestic supply/demand gap, beyond their total production capacity, local manufacturers have a guaranteed market for production that they are able to produce as 148 kg-tons of PSF imports are already talking place," he continued.

Aptma has further argued that import of PSF is necessary for the textile re-export industry that remains un-catered by local PSF manufacturers.

PSF imports from India would substitute only a part of imports already taking place from other countries without affecting local PSF manufacturers."Import of PSF from India would be at a saving for the re-export industry on account of saving on sea-freight etc and lesser land freight charges, thus adding to the international competitiveness of Pakistan in the global textile market," he continued.Aptma maintains that domestic PSF manufacturers enjoy a cumulative protection of more than 20 percent vis-à-vis imported PSF on account of the following factors: (i) inland freight charges in the PSF exporting country; (ii) 6.5 percent import duty; (iii) sea freight from PSF exporting country to Pakistan; (iv) import charges for PSF importers in Pakistan; and (v) inland transportation and port charges from Pakistan home port to destination."We are hopeful that PSF will not be included in the negative list to provide an opportunity for the competitive procurement of a basic raw material for value-addition and re-export without any detriment to domestic PSF products," the Aptma said.

Courtesy: Business Recorder

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