PRGMEA demands specific budgetary aid in their financial plan
Pakistan's Readymade Garments Manufacturers and Exporters Association (PRGMEA) has issued an urgent call to action, demanding specific policy changes in the upcoming budget to support the country's value-added textile export sector. Addressing critical challenges, the association advocates for the revival of the Export Facilitation Scheme (EFS) and the Final Tax Regime (FTR), among other measures.
In a direct appeal to Prime Minister Shehbaz Sharif and Special Assistant to the Prime Minister on Industries and Production, Haroon Akhtar Khan, PRGMEA's former Chairman, Ijaz A Khokhar, has outlined six crucial sectors requiring immediate attention.
First and foremost, Khokhar has urged the reinstatement of the EFS and the restoration of the FTR. He also suggested addressing high U.S. tariffs, clearing refund backlogs, preparing for the GSP+ review, and launching a national branding campaign to promote "Made in Pakistan" garments.
Khokhar has emphasized the need for reforms to regain Pakistan's competitive edge. With global apparel buyers diversifying their sourcing hubs, this presents a rare opportunity for local exporters. He believes that continuity, lower costs of doing business, and SME-focused facilitation are essential to unlock the sector's full potential, aligning with the Prime Minister's vision of achieving a $100 billion export target.
PRGMEA has advised against adding sales tax within the EFS framework, as it could lead to double taxation and burdensome administrative costs for exporters. The association also argues that restricting imports of essential raw materials under the EFS would harm Pakistan's value-added apparel exporters' competitiveness.
The association has insisted on a quick restoration of the FTR to simplify tax compliance and improve the overall ease of doing business, particularly for SMEs. Moreover, they urge the government to negotiate a zero-for-zero tariff agreement with the United States to boost export competitiveness.
Another immediate concern for the association is the clearing of refund backlogs and the implementation of a fully automated, time-bound refund mechanism to ensure uninterrupted cash flow. To expand Pakistan's global footprint, PRGMEA has suggested launching a robust marketing and branding campaign for "Made in Pakistan" garments, with trade fairs, B2B matchmaking, and digital outreach playing significant roles.
In a nutshell, the PRGMEA recommends reducing tariff barriers, ensuring swift financial reimbursements, safeguarding export facilitation incentives, simplifying tax regimes, and securing government support to maintain and expand Pakistan’s value-added textile exports, aimed at achieving ambitious export targets. Without decisive action and policy continuity, the true potential of this sector and its contribution towards national export targets may remain unrealized.
- The Pakistan's Readymade Garments Manufacturers and Exporters Association (PRGMEA) suggests that the government reinstates the Export Facilitation Scheme (EFS) and the Final Tax Regime (FTR) to support the value-added textile export sector and regain the country's competitive edge.
- With global apparel buyers diversifying their sourcing hubs, there exists an opportunity for local exporters to boost their competitiveness, a goal that aligns with the Prime Minister's vision of achieving a $100 billion export target.
- To maintain and expand Pakistan’s value-added textile exports, PRGMEA recommends reducing tariff barriers, ensuring swift financial reimbursements, safeguarding export facilitation incentives, simplifying tax regimes, and securing government support.
- The association also advocates for clearance of refund backlogs, the implementation of a fully automated, time-bound refund mechanism, and a robust marketing and branding campaign for "Made in Pakistan" garments to expand the country's global footprint.
- PRGMEA warns that without decisive action and policy continuity, the sector's true potential and its contribution towards national export targets may remain unrealized. Additionally, adding sales tax within the EFS framework could lead to double taxation and burdensome costs for exporters, and restricting imports of essential raw materials under the EFS would harm competitiveness.
