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Garment makers see cartel behind surging yarn prices

Garment makers see cartel behind surging yarn prices

LAHORE: The Pakistan Readymade Garment Manufacturers and Exporters Association (Prgmea) has urged government to take notice of a 25 per cent surge in yarn prices “due to cartelisation of local manufacturers”.

In a statement issued on Monday, Prgmea Chief Coordinator Ijaz Khokhar said a rise in yarn prices to Rs11,500 from Rs9,950 during the last one-and-a-half months was adversely affecting the apparel sector.

He blamed the price hike on a cartel of local manufacturers who, he said, were taking advantage of 10pc additional regulatory duty on yarn imports.

The prices of all varieties including 10-count single yarn, 16-count 30 yarn and 16-count 20 yarn — had increased by the same ratio.

Urging the government to take preventive measures, Mr Khokhar said the export target of $25 billion could not be achieved in the previous fiscal year due to high energy cost and discriminating import duties on industry raw material.

He also asked the government to abolish additional regulatory duty on cotton yarn. “As the apparel sector already has a very limited production line owing to lack of latest fabric varieties at local level, the harsh duties are leading to decline in apparel exports.”

Mr Khokhar also suggested the government should ban exports of raw cotton and cotton yarn for a short period until the arrivals of new crop start to rise and prices rationalise on the domestic market.

He asked Prime Minister Nawaz Sharif to personally direct policymakers to work for reduction in all input costs otherwise the export-oriented industries would shut down and millions of workers would lose their jobs.

The premier, he said, had committed to hold meetings with export-oriented industries on a quarterly basis, but no such meeting had been held so for.

“We don’t see any improvement in the present scenario. In fact, exports situation would be further aggravated as the textile ministry is operating without its minister,” he said.

Courtesy : Dawn News



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