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Business Recorder
12-06-2025
- Business
- Business Recorder
APTMA, US CG discuss ways to foster bilateral trade
LAHORE: Kristin K Hawkins, United States Consul General in Lahore, and All Pakistan Textile Mills Association (APTMA) office-bearers discussed ways to foster bilateral trade and economic relations between Pakistan and the United States of America. Kamran Arshad, Chairman APTMA, Asad Shafi, Chairman North, Ahmad Shafi, Vice Chairman, Mohammad Qasim, Treasurer, Haroon Ellahi, senior Executive, former Chairman Ali Ahsan, and Secretary General Raza Baqir along with senior members of APTMA representing leading textile groups welcomed Kristin Hawkins, William Campbell, Economic Chief and Amna Anis Economic Specialist. They discussed the enormous potential to work together in the field of cotton and textile besides expanding trade and investment relations in other focused areas reducing trade deficit and diversifying major commodities of trade between both countries in the wake of US reciprocal tariffs. Both sides were of the view that Pakistan has strong potential to grow in textile and other sectors. APTMA leadership continued to focus on engagements and dialogue with their American counterparts to uplift trade volume and to gain maximum benefit of economic partnership between both the countries. Speaking on the occasion, Kamran Arshad made a detailed presentation on textile industry of Pakistan. He pointed out that Pakistan's domestic cotton production has declined over the years and even this year huge quantity of cotton would be required to be imported due to poor cotton crop. He said the major supplier of cotton to Pakistan is the USA. Pakistan is the largest importer of US cotton in the world. He added that the import of US cotton compensate loss in production of local cotton. According to Kamran, the availability of cotton and other inputs is essential for economy of the country as textile constitutes 62% of total exports from Pakistan. Kamran Arshad highlighted issues being faced by textile industry including withdrawal of Regionally Competitive Energy Tariff for both electricity and gas. He specifically mentioned discriminatory tax treatment for local supplies and import of inputs under Export Facilitation Scheme (EFS) which allows tax-free import of raw materials but levies sales tax @ 18% on procurement of locally produced goods. This discrimination has forced closure of 120 spinning mills and more than 800 ginning factories, increasing import of yarn from $340 million last year to $800 million this year. Kamran emphasised for restoration of even playing field both for imports and local supplies under EFS to ensure continuous operations of textile industry as any shut down of textile sector would render millions as jobless, creating catastrophic situation endangering survival of the country. He stressed on evolving a mechanism to import US cotton under GSM-102 against export of textile products to the US. He added that proceeds of Pakistan textile export to the US may be used as collateral through the mechanism of an escrow account whereby this liability is deducted from the export proceeds of Pakistan textile import into the US. Speaking about the strength of the textile industry in Pakistan and further expansion of bilateral trade between the US and Pakistan, Asad Shafi, Chairman North said that the US is Pakistan's largest trading partner with a total bilateral trade of $9.85 billion in 2024. According to him, total exports of Pakistan to the US stood at $5.12 billion out of which $3.93 billion or 77% were textile and apparel. As against this, Pakistan imported $2.14 billion goods from the US in 2024 of which cotton imports were more than $700 million. Asad stressed upon promotion of US cotton linkages with Pakistan textile industry, as well as, promotion of toll manufacturing in Pakistan by US textile industry. He said there is a need for technology transfer to Pakistan for high yielding cotton seed and synergies with US cotton research institutes for better quality. He also sought capacity building of agricultural research institutions in Pakistan and technology transfer for cotton traceability. Asad said that the United States should facilitate entry of international seed companies with transgenic technologies besides introduction of improved, genetically modified, and certified seed. He also spoke on the importance of establishing joint ventures between Pakistan and US investors. Meanwhile, speaker of the Punjab Assembly, Malik Muhammad Ahmad Khan, met with the United States Chargé d'Affaires, Natalie A. Baker, and US Consul General Kristin Hawkins, at the Punjab Assembly. The Speaker warmly welcomed the distinguished guests and termed their visit to the Assembly as a positive step towards strengthening institutional ties. On this occasion, Malik Muhammad Ahmad appreciated Natalie Baker's constructive and dynamic role in Pakistan, stating that Pakistan–US relations are based on mutual trust and a valued strategic partnership. He emphasized that the United States' proactive and constructive role in ensuring peace in South Asia is of utmost importance. The meeting included detailed discussions on Pakistan–US relations, regional peace, climate change, food security, educational collaboration, and cooperation in other vital sectors. The Speaker expressed a desire to further deepen ties between Punjab and the US state of California, noting that the Pakistani-American community continues to serve as a robust bridge between the two nations. He further remarked that Pakistan views the United States as a key global partner in addressing climate change, development, and food security, and wishes to expand this strategic cooperation even further. Natalie Baker affirmed that the United States aims to further strengthen diplomatic engagement with Pakistan and will continue to support democratic institutions and parliamentary exchanges. Kristin Hawkins expressed her intent to enhance collaboration in the fields of education and social development. The meeting was also attended by Member Provincial Assembly Iftikhar Chachar, Secretary General of the Punjab Assembly Chaudhry Amer Habib, Principal Secretary to the Speaker Imad Hussain Bhalli, and Malik Taimoor Ahmad Khan. Copyright Business Recorder, 2025
Business Recorder
22-05-2025
- Business
- Business Recorder
PTC submits budget proposals to PM
ISLAMABAD: The Pakistan Textile Council (PTC) has submitted its proposals to the Prime Minister for federal budget 2025-26 meant to enhance export competitiveness, stimulate economic growth, reduce IMF dependency, empower women and support SMEs. The proposals submitted to Finance Minister and FBR are as follows: (i) reintroduction of Regionally Competitive Energy Tariff (RCET) for gas and electricity. Freeze tariff for 3 years; (ii) remove cross-subsidies; (iii) abolish 0.25% EDF surcharge on export proceeds; (iv) reduce compliances, unify regulators (e.g., KPT, shipping agents), and establish new industrial zones with one-window operations; (v) for better utilization of funds from statutory contributions, EOBI, Social Security, Labour Department, Worker welfare fund may be merged as one window operation. Rate of contribution to these institutions may be revised and decreased; (v) as the inflation is low, any minimum wage increase should not be more than 5%. Concept of Min-wage may be revised as 'fair wage' defined as 60% basic pay plus allowances;(vi) over time limit may be revised with more flexible hours as four hours in a day without weekly limits. Rate of Overtime may be revised at 1.5 of ordinary rate of basic pay (60%) per hour; (vii) Final Tax Regime (FTR) may be reintroduced for exporters;(viii) advance Tax, should be abolished otherwise it should be based on the Tax assessed for previous year as is applicable to other corporate sectors;(viii) withdrawal of Super Tax on high earners;(ix) enhancing the limit for salary payable in cash to Rs 70,000/; (ix) restore initial depreciation allowance on plants and machinery to 50% and 25% for building;(x) investment tax credit - exporters be allowed to get refund of their tax credits if any amount of credit is unutilized; (xi) Minimum Tax be phased out for listed companies;(xii) Pakistan's corporate tax rate (29%) is above regional average and may be gradually reduced to 20%, prioritizing listed firms;(xiii) no fiscal incentives exist to support green or SDG-compliant investment. Targeted reliefs and incentives to be introduced; (xiv) reduction in Further Tax under section 3 (IA);(xv) extension in time Period for Input Tax Adjustment to 12 months as delayed receipt of invoices etc.;(xvi) joint liability of Registered persons in supply chain may be removed; (xvii) exemption of Listed Companies from Section 8B;(xviii) expediting process of sales tax refunds. For overruling of the sales tax deferred refunds, the required document must be highlighted in the system which can be traced from FBR system or attach scanned copies in the system to process the refunds at earliest; (xv) clear all pending refund claims to ease liquidity crisis of exporters to fully utilized potential of increasing textile exports by $ 3-4 billion per annum; (xvi) registration and Deregistration U/s 14 be expedited and be done within a week from date of filing of application; (xvii) revision of Sales Tax Return - IRIS system may be modified in accordance with the sub sections (3) and (4) to Section 26 of the Sales Tax Act, 1990 to allow registered persons to file revised return along with tax and surcharge without seeking prior approval of the commissioner; (xviii) curtailing discretionary powers of tax officers: section 37 and section 38 may be suitably amended and prior approval of the Board be required before initiating proceedings against registered persons who are on the Active Tax Payers List; (xix) Section 37A of Sales Tax Act 1990 be amended in line with Supreme Court of Pakistan's judgement dated 4-12-2024 in case No 17653/24 which says that the power to arrest and prosecute is part of criminal proceedings and cannot be done till determination of civil liability;(xx) accessing of accounts & records should be limited to once a year as per Section 25, and audit should be conducted after scope, guidelines and mechanism of audit are provided for in Law;(xxi) 40B and 40C may be eliminated to minimize chances of corruption and direct contact between taxpayer and tax collector or only be done after completion of due process of law, including issuance of show cause notice; (xxii) restore EFS to its pre-Finance Act 2024 form, including the sales tax exemption/zero-rating on all local supplies used for export manufacturing;(xxiii) abolish 5% withholding tax on purchases by export companies; (xxiv) expand the existing 25% tax reduction policy (currently for 100% women-owned businesses) to businesses where women own less than 50% and 25% of the workforce are women; (xxiv) withdrawal of Custom Duty on industrial spare parts; (xxv) net value of product: It is proposed that custom duty may be charged at net transactional value of product. Cost of insurance, freight, port handling charges etc. may not be included in value;(xxvi) reduce dwell time at customs stations; (xxvii) use FOB for Tax purposes-Reduce input costs; (xxviii) restore Duty Drawback of Taxes (DDT) & DLTL as per Textile Policy 2020–2025; include in new 2025–2030 policy. Provide funds in the budget to clear all outstanding claims; (xxix) allocation for Export Finance Scheme (EFS) and Long-Term Financing Facility (LTFF) be enhanced and building infrastructure also be included in LTFF; (xxx) allocation for Trade/ Export Credit Insurance be enhanced and services be provided at low premium by EXIM bank along with credit against shipped goods. Strengthening EXIM Bank and funds be allocated to it to offer capital finance at 4–5% for 5–10 years, with SME-specific allocations; (xxxi) allow back-to-back Letters of Credit (LCs) for exporters; enhance SBP oversight on commercial banks; (xxxii) extend Technology Upgradation Fund (TUF) scheme till 2025 and release pending claims from 2009; and (xxxiii) interest free loans for green / sustainable technology, wastewater plants, and effluent treatment plants/machinery be provided. Copyright Business Recorder, 2025
