PTA demands finished leather inclusion
RECORDER REPORT
KARACHI: Pakistan Tanners Association chairman Amanullah Aftab has urged the caretaker Federal Commerce Minister and Secretary Commerce to ensure inclusion of ‘Finished Leather’ in the new Drawback of Local Taxes and Levies (DLTL) for 2018-21.
He said that the manufacturers-cum-exporters of finished lather are contributing significantly to the country’s GDP by making necessary highly value additions from raw skins to finished leather with new innovations after going through the detailed hectic 23 vital procedures for necessary value addition but they are deprived of DLTL scheme in the new export package announced by the government for the year 2018-21.
“The tanning industry of Pakistan is fully competent and capable of producing all types of fashion leather including printed leather, foiled leather, patent leather et cetera,” he said, adding that Pakistan enjoys number two position after Italy as far as quality of leather is concerned.
PTA chairman further said that finished leather made of cow, buffalo, sheep and goat skin is highly value added and value addition is around 150% or more as finished leather and also being sold to high value branded shoes. He said leather industry is the 2nd biggest export-oriented industry in terms of significant contribution to the country’s GDP, besides it is also imperative to clarify here that ‘finished leather (value added leather) had around 38.5% export share out of total export of leather sector of Pakistan that was US$ 918.131 million for the year June-June 2016-17.
“It is astonishing to note that dyed and printed fabrics for textile sector are included in the new DLTL scheme for next 3 years while the finished leather is deprived of the said incentive, which is similar product/commodity of leather industry,” he said.
Amanullah Aftab said that with necessary innovative value addition from raw skins to finished leather form, it becomes eligible for the export to get the precious foreign exchange with higher prices of per SQFT as compared to rest commodities of leather sector such as leather garments, leather products/ footwear/ made-ups etc.
He warned that its marketing/selling at internationally market would be suffered and hampered to a great extent and resultantly the export of finished leather would further be declined drastically if this sector is not included in the new DLTL scheme because finished leather is mother product of leather industry, which is already in heavy declining trend and facing numerous problems/hardship in production.
He highlighted that all high grades of leather of cow, buffalo, sheep and goat skins are exported exclusively to the foreign potential buyers/customers specially to international brands and fetching much higher prices and value addition from raw materials that is 2.5 times more. He said much higher average prices is around from US$ 1.50 per sqft to US$ 3.00 per sqft of high quality grade leather as compared to the unit price of per sqft used in rest of commodities of leather sector such as leather footwear, leather garments, leather made-ups, which cost between US$ 0.60 per sqft to US$ 1 per sqft as inferior quality and easily available in local market abundantly and can be imported without any duty.
PTA chairman said that issue of inclusion of dyed/finished leather in the new DLTL scheme was already brought to the notice of secretary ministry of commerce in a specific meeting held recently and he was convinced realizing the gravity of issue/matter. PTY chairman said that latter assured the PTA’s delegation to look into the matter favourably for the inclusion of dyed/ finished leather in the new DLTL scheme for the export package for the year 2018-21 with the same spirit as announced for rest of commodities of export sectors.
Besides, the CEC of PTA has also passed a unanimous resolution during its 4th meeting on 09.06.2018 with resentment and disappointment over elimination of core product of mother industry of leather sector. It demanded strongly that ministry of commerce immediately include dyed/finished leather in the new DLTL scheme for export package for the year 2018-21 as soon as possible so that the genuine exporters/PTA members would also be facilitated to continue to play its due viable role in strengthening the country’s economy by fetching more precious foreign exchange.
