Expected regulatory duty stirs polyester yarn business
AMANULLAH KHAN KARACHI—Central Chairman of Pakistan Yarn Merchants Association Muhammad Usman, while giving some suggestions to resolve the conflict over imposition of regulatory duty on polyester filament yarn, advised the government that fabric imports from any part of the world should be allowed under legal channel of import which includes Letter of Credit (LC) or Documents Against Payments (DP) whereas the payments via banking channels can to save the local downstream industry. He further asked the government to put import of fabric from Dubai on negative list as there no weaving/ knitting factories exist in Dubai while the Indian origin fabric was simply being routed thru Dubai, resulting in causing severe losses to local industries.
Seeking government’s attention, Chairman PYMA pointed out that the local manufacturers of Polyester Filament Yarn can only meet the needs of local downstream industry to the extent of about 25 percent whereas the rest of 75 percent requirement is met through imported yarn. Despite the fact that investigation was currently underway by National Tariff Commission to review Anti-Dumping Duty, Some manufacturers including Gatron and Rupali were lobbying very hard to ensure imposition of regulatory duty, which would result in bringing the weaving and knitting industry on the verge of complete collapse, he said, adding that these attempts by local manufacturers would put the entire weaving and knitting industry in grave situation by increasing the cost of yarn, thus making the entire downstream industry uncompetitive.
Muhammad Usman warned that results would be disastrous for the Exports which are already suffering on account of high energy costs. He said that few local manufacturers were attempting to monopolize in order to gain short term benefits at the expense of huge large downstream sector which employs millions of people and is the back bone of economy. He further pointed out that an anti-dumping duty of 18 percent was imposed on imported filament yarn from Thailand, Malaysia, Korea and Indonesia in 2005 and at that point in time, a total of 17 local yarn manufacturers were operating whereas this raw material was not being imported from China. Despite improving the situation, this measure proved to be counterproductive as during the last over 8 years since the imposition of Anti-Dumping duty, the number of local manufacturers has reduced to just four units while the market share has also drastically descended, he added.