The Karachi Cotton Association has urged the government to waive all duties and taxes on import of cotton immediately in the national interest so that the local textile industry is able to export optimum quantity of value added products of raw cotton in the international market.
The Pakistan government had decided to impose 3 percent customs duty, 2 percent additional customs duty, 5 percent sales tax and 1 percent income tax on import of raw cotton with a view to encourage use of the local cotton crop.
KCA views that the Government should realise that due to anticipated decline in cotton production again in cotton season 2018-19 especially owing to severe water shortage during cultivation period and usual factors of reduction in yield per acre, cultivation of sugarcane in the areas earmarked for cotton cultivation and supply of uncertified Cotton Seed etc.
The local textile industry is, therefore, compelled to import raw cotton from abroad to meet its requirement of basic/primary raw material.
However, after payment of such heavy duties and taxes imposed on import of cotton, the cost of imported cotton will be considerably increased due to which the local textile industry will become unable to compete in the international markets. As a result of this, the exports of value added products of cotton and foreign exchange earning of the country will be badly affected.