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Pakistan’s Duty Drawback Extended to All Exporters Using Polyester

Pakistan’s finance ministry has confirmed to the Economic Coordination Committee (ECC) that all textile and apparel exporters using polyester staple fiber (PSF) can benefit from duty-drawback rates.

According to Business Recorder, a joint examination by the Federal Board of Revenue (FBR) and the textile ministry found that under SRO 209(1) 2009, duty drawbacks are to be granted to all exporters, regardless of whether they’ve used imported or locally-sourced polyester.

Pakistan’s imports of manmade yarns, mostly from China, climbed 20 percent in 2014-15 compared to the previous year as the country sought to diversify a mainly cotton-based industry. But the All Pakistan Textile Mills Assocation (APTMA) recently argued that the government’s 6 percent customs duty and import incidental together with local PSF manufacturers’ margin has made it difficult for the country to compete on the synthetics stage at home and abroad.

The latest announcement will likely increase manmade fiber content in exports. In addition, the government recently implemented a five-year textile policy to promote the sector that includes a financing plan of roughly 3.6 billion rupees ($35.3 million) for the next four fiscal years.