Spinners have warned that any curbs on yarn export resulting in lower prices of the commodity would be counter-productive f the value added textile sect which may be subjected to countervailing duties under the World Trade Organisation.
All Pakistan Textile Mills Association¡¯s former chairman Akber Sheikh warned the clothing sect that any restriction on yarn export as demanded by the textile value added sector, being contrary to WTO obligations, would lead to textile value chain being considered a beneficiary of subsidised input. The entire industry would become vulnerable to countervailing duties by importing countries, he added.
He said European Union countries were sensitive to trade-distorting measures evident the countervailing duty imposed on export of bedlinen India a complaint file against subsidy being given to the PTA industry in Pakistan.
¡°Our textile regime, on some issues, is treading a fine line (the value added sect is the beneficiary of around Rs40 billion package, most of which qualifies as actionable subsidy) it will be unwise to disturb our trading partners while the government is engaged in trade diplomacy f improving access to EU US markets f our textile value added products.¡±
He pointed out that EU trade counsellors had already complained about export restrictions on raw leather Pakistan. They would be much more sensitive about cotton yarn.
He said the value added sect should adopt a mature stance. The sect should learn to live with market forces like the spinning sect which even in a period of acute raw cotton shortage never demanded a ban on cotton export.
He said according to a statement on TV by maj value added exporters, textile importing countries were willing to offer high prices to compensate f the increase in international prices of cotton yarn.
He said the difficulty being faced by the industry was only pertaining to orders at h that only f those exporters who made a bad decision by not covering raw material supply at the time of booking orders.
Any depression in the price of yarn brought by restrictions would lead to withdrawal of price increase offer by the importers. That, in the long term, would be a national loss f Pakistan, he added.
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