Lahore   -  The finance division has announced the approval of around Rs.26 billion for the financial year of 2018-19 to be provided to the SNGPL for supply of gas to the export industry at $6.5/MMBTU.

According to a notification issued by the finance division, government of Pakistan, Rs.2.5 billion have been released for ministry of energy, petroleum division, for the months of October and November to be paid to the SNGPL so that it could supply gas to the five zero-rated export industries in Punjab.

The government in Sept this year had announced to provide gas and electricity to the five zero-rated exporting sectors at regionally competitive rates, which was also endorsed by the Economic Coordination Committee (ECC). However, the long delay in implementation of this energy affordability initiative continued to panic the Punjab export-oriented industry.

“Now we are happy that the government, after some delay, has issued the notification to release funds so that ECC decision of lowering energy tariff could be implemented in its true spirit,” said Pakistan Hosiery Manufacturers Association chairman Adil Butt.

He said the value-added knitwear industry was jubilant on acceptance of a long pending demand of a massive cut in input costs and vowed that it would double the exports in the next five years.

Adil Butt welcomed the approval of release of funds and expressed deep gratitude to Prime Minister Imran Khan for keeping his words of reviving the export-oriented industry by announcing equal gas tariff across the country.

“We welcome the release of funds to implement the ECC decision of gas supply to the industrial sector in Punjab and Khyber Pakhtunkhwa at $6.5/MMBTU similar to the consumers of SSGC in Sindh.”

Adil Butt said the role of value-added knitwear sector is vital in the national exports and the government should accord top priority to this sector taking necessary steps and measures to enhance its export efficiency. The export-oriented industry has been facing multiple challenges in the wake of high cost of manufacturing, exorbitant utility tariffs and high labour wages comparing to the competitors on the world markets.

“We appreciate the govt efforts to reduce the cost of manufacturing and make the value-added textile export industry more viable,” the chairman added.

He also urged the government to work on rationalizing duties structures and minimize taxes and duties on import of raw materials and instead apply duties on import of finished/luxury goods in order to facilitate the domestic industry. The Ministry should also hold a meeting to simplify DTRE Scheme.

He said the ministry should also discourage export of raw material and encourage export of value-added items. He reiterated the request of value-added textile exporters to the State Bank of Pakistan to facilitate exporters’ authorized dealer to make import advance payments against irrevocable Letters of Credit (L/C) up to 100 percent of the value of the goods and up to $10,000 per invoice for the import of all eligible items without the requirement of L/C or Bank Guarantee from the supplier abroad.