Leather garment industry in distress

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Amanullah Khan

Karachi—Regional country’s leather industry is growing up but in Pakistan, Leather Garment Industry is in reversal and declining in Exports due to which it is near to be closure and Government is not paying attention on this issue, said Chairman Pakistan Leather Garments Manufacturers & Exporters Association Atif Ashraf in a press statement.
He further said that Leather Garment Industry of Pakistan is in distress and about to collapse if Federal Government does not come forward to bail out by giving incentive and extra pay attention to address the issues faced by the Leather Garments Exporters. Our Industry is High value-added industry and after Textiles it is the second largest value-added Export sector of Pakistan.
The decline in quantity of Leather Garments Exported is around 12.35% during 2015-16 from 2014-15 as per Pakistan Bureau of Statistics which is very alarming and the industry is facing closure. Unless the Government announces and implements relief package for this Industry, the Exporters will be forced to close down their units causing unemployment to workers.
The Governments of India and China have offered high duty drawback rates to their Exporters as incentive for boosting Exports. China offers 8.5% Duty Drawback rate on Export of Leather Garments and India 9.5%. Our Duty Drawback rate is only 4.26% for Leather Jackets. This Duty Drawback percentage assigned when the taxes on Import stage was at 0% for Raw Skin, Pickle and Wet Blue. Now the Government charges 3% as customs duty and 1% withholding tax on import stage and Duty Drawback rate is not revised while Leather Garments Exporters import 60% to 70% raw material for manufacturing purpose.
Chairman Pakistan Leather Garments Manufacturers & Exporters Association Mr. Atif Ashraf strongly urged to Prime Minister of Pakistan and Federal Minister for Commerce to activate TDAP and Commercial Consulars in Pakistani Missions Abroad.