The textile industry in Pakistan suffers due to lack of basic working capital. The industry wants a policy for clearing pending refund claims within a stipulated period. At one time, authorized dealers could send advance payments up to $10,000 per invoice for import of all eligible items without the requirement of letter of credit or bank guarantee to suppliers aboard.

This facility has been withdrawn and this has affected export-oriented industries, creating hurdles in meeting on-time export commitments while increasing the cost of doing business. The value-added garment sector has grown 11.22 per cent in 2017-18 despite internal and external challenges. The value-added garment sector is a major tax payer, the largest employment generator in the whole textile chain and exports worth $5.5 billion.

One suggestion is a one window operation could replace the lengthy procedure that involves interaction of manufacturers with various agencies. Another is social security and all other taxes should be merged and deducted at source. The feeling is the exchequer will receive more revenue if a reasonable percentage of realized amount is deducted. Also many small and medium enterprises will be added in the tax net automatically.