Textile owners threatened a strike over the non-clearance of imported cotton containers at Karachi Port.
The All Pakistan Textile Mills Association (APTMA) chairman Hamid Zaman said during a discussion that the industry will have no option but to stage a protest if the government doesn’t clear the imported cotton coming to Karachi.
The APTMA chairman said the industry would fall short of its $25 billion export target this year due to a lack of raw materials, primarily raw cotton. He said textile exports will be limited to $16 billion or $17 billion this year.
He explained that the textile industry imports raw cotton and then exports it at four times the import value. If things are not controlled, 7 million people working in the industry will be out of work in January.
He further warned, “The industry has left with 60 days’ raw materials only and if timely clearance of already arrived cotton will not start from the port, textiles will completely shut down. This will result in unemployment of 25 million people across the country”.
Zaman said the textile industry has so far ordered 1.7 million bales of cotton from the US and 100,000 bales have already arrived at Karachi port with a value of more than $300 million. To avoid a possible export crisis, the APTMA chief urged the government to direct commercial banks and the State Bank of Pakistan to open letters of credit for cotton importers on time.
In response to questions, Zaman admitted that some exporters were unable to return their export proceeds to Pakistan due to currency fluctuations. He also urged the government to take action against those who were stockpiling US dollars, pledging APTMA support for the cause.
On another pressing issue, the APTMA official pointed out that demurrages and detention charges on imported goods had exceeded the value of the goods for which foreign companies were required to pay. “So far, Rs. 2 billion in demurrages and detention charges have been charged, which are increasing with time”.
APTMA senior vice chairman Kamran Arshad said there is a severe shortage of raw cotton in the local market and in order to achieve $20 billion in exports, 15 million cotton bales were required. Asad Shafi, vice chairman of the association, closing shops and markets earlier would cost the government billions of rupees in revenue.