Islamabad, Feb 11: Kamran Arshad, Chairman of the All Pakistan Textile Mills Association (APTMA), has expressed deep concern over the worsening crisis in the country’s spinning industry. He revealed that over 100 spinning mills, accounting for nearly 40 percent of the industry’s production capacity, have already shut down, with the remaining mills operating at less than half of their capacity. APTMA has warned that the current pro-import tax policies are pushing the spinning industry towards collapse.
According to Arshad, yarn imports hit a record 32 million kilograms in January 2025, with total imports for the fiscal year 2024-25 expected to triple compared to the previous year. This surge in imports, combined with the country’s struggling domestic production, is severely undermining the competitiveness of local mills.
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A key issue highlighted by the APTMA Chairman is the current sales tax regime, which imposes an 18 percent tax on domestic supplies for export manufacturers but allows duty-free imports. Arshad criticized this disparity, warning that if the situation persists, the local textile sector may be overtaken by imported goods, resulting in significant economic consequences for the industry and the broader economy.
Additionally, exporters are burdened with paying sales tax upfront, facing delays of up to a year for partial refunds. Around 30 percent of refund claims are withheld indefinitely due to manual processing inefficiencies.
APTMA has called for urgent policy revisions, urging the government to eliminate the tax burden on local input supplies. This move, the association suggests, will restore competitiveness to Pakistan’s domestic textile manufacturing sector and help secure its future.
