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News Clips 14 May, 2013


[ All ST refund claims to be cleared, exporters told ]
[ Exports dipped 4pc in April ]
[ Hundreds of Bangladesh textile plants shut indefinitely ]
[ H&M, Inditex back Bangladesh worker safety agreement ]

All ST refund claims to be cleared, exporters told   [ top ]

BUSINESS RECORDER, Recorder Report, May 14, 2013
Chief Commissioner (RTO) Muhammad Anwar Goraya has ordered to clear all pending claims of exporters' refund immediately and instructed the Additional Collectors and the Deputy Collector to issue the Refund Payment Order (RPO) without further delay.

In a meeting with Chairman, Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) Sub-Committee on Sales Tax and Customs Affairs, Abdul Wahid Bandukda, the RTO has issued instructions to clear refund claims of sales tax. On this Occasion, Shaikh Mohammad Shafiq, Chairman SZ, Arshad Aziz and some prominent members were also present. The Chief Commissioner heard all the grievances of the exporters in details and assured to resolve their pending issues. He also instructed to the officers concerned to issue objection memo or give the reason of rejection to the claimant along with their RPO so that the claimant can submit the required documents for those rejected claims.

He also agreed to give copies of objection memo of previous long pending claims to the claimants, assuring that those companies which had received their RPOs would be issued cheques on priority basis as soon as funds were sanctioned against the same.

Abdul Wahid Bandukda informed that a lot of claims were declined against clearing agents' service charges and courier charges etc to, which RTO Chief informed that they were resolving that issue with the Sindh Revenue Board (SRB) under whose domain those service charges fall into. Objections and recoveries under CREST software were also discussed.

The Chairmen Sub Committee informed the RTO Chief that most of those objection related to classification of suppliers and exporter as non-zero rated sector, whereas the suppliers as well as the exporter were doing taxable activity since many years in the textile sector and for the reason of non awareness their lower staff or agents, they had not mentioned Textile activity while registering online for e-filing.

The Chief Commissioner advised Bandukda that the exporters and suppliers could change their status online and submit the required documents with the RTO where they would look into the matter and withdraw the objections of non-zero rated issue on merit so they might avail the two percent (earlier zero percent) concessionary rate of sales tax along with the five zero rated sectors.

In addition the Chief Commissioner accepted invitation from Chairman PRGMEA, Shaikh Mohammad Shafiq for conducting workshop on CREST software to train PRGMEA members and address issues related to that software to ease difficulties faced by the members. He assured that FBR's IT experts would be invited from Islamabad to give training to PRGMEA members.

Exports dipped 4pc in April   [ top ]

DAWN, Staff Report, May 14, 2013
ISLAMABAD, May 13: Pakistan’s exports of merchandise fell by over four per cent in April 2013 from a year ago after witnessing successive growths in the past few months.

Since October 2012 exports rebounded because of a slight rise in demand from recession-hit key markets of Europe and the US. However, exports dipped to $2.130 billion in April 2013 from $2.229bn in the corresponding month last year, showed data of the Pakistan Bureau of Statistics (PBS) released on Monday.

Experts predict that export proceeds may witness slight decline in the months ahead because of fear of slump in the global economy. Exports rose by 4.23pc during July-April 2012-13 while imports declined 1.02pc.

Exports rose to $20.147bn in July-April from $19.329bn in the corresponding months last year, showing an increase of 4.23pc. In 2011-12 exports stood at $23.641bn as against $24.810bn in the previous year.

For the current fiscal year, government projected export proceeds at $27bn.

The current account in the first 09 months (July-March) crossed the $1bn-mark at the end of third quarter of this fiscal year. The State Bank reported has said the current account deficit for July-March 2012-13 rose to $1.028bn.

But it was still one third of $3.038bn deficit the country posted in the first nine months of 2011-12.

Import bill declined by 1.02 per cent to $36.665bn in July-April from $37.042bn over the same period last year.

On monthly basis, imports surged by 4.05pc to $3.909bn in April from $3.757bn over the corresponding month last year.

As a result, Pakistan’s trade deficit in merchandise fell by over 6.75pc in the 10 months of the current fiscal year from a year ago as imports dropped while exports witnessed a paltry growth.The trade deficit narrowed down to $16.518bn in July-April period of the current fiscal year as against $17.713bn over the corresponding period of last year.

In 2011-12 the trade deficit swelled to $21.271bn in from $15.604bn in the previous year mainly driven by import of consumer goods and higher international crude oil prices.

For 2012-13, the government has forecast trade deficit at $17.126bn which reflects low demand from manufacturing side.

Hundreds of Bangladesh textile plants shut indefinitely   [ top ]

THE RAW STORY, Agence France-Presse, May 13, 2013
Hundreds of factories which form the hub of Bangladesh’s garment industry are to close indefinitely after worker unrest sparked by the death of more than 1,100 colleagues, employees announced Monday.

As the search for bodies from last month’s collapse of a factory complex wrapped up, the textile industry’s main trade body said all operations at the nearby Ashulia industrial zone on the outskirts of Dhaka were being suspended until further notice.

Shahidullah Azim, of the Bangladesh Garment Manufacturers and Exporters Association, said the decision was made “to ensure the security of our factories”.

Local police chief Badrul Alam told AFP workers in 80 percent of the factories had walked out earlier in the day to demand an increase in salaries as well as the execution of the owner of the collapsed Rana Plaza complex in the town of Savar.

Most of Bangladesh’s top garment factories are based at Ashulia and there has been “virtually no work” there since the April 24 Rana Plaza tragedy, Azim said.

Tensions in Ashulia had been further inflamed by the discovery of a dead female garment worker on Sunday. Police said they suspect that the death was a suicide sparked by a “love affair”.

Ashulia is home to around 500 factories which make clothing for a string of major Western retailers including Walmart, H&M, Tesco and Carrefour.

News of the indefinite closure represents yet another body blow to the industry, which has pleaded with Western retailers not to pull out of Bangladesh and promised to come up with a credible safety framework.

Swedish fashion giant H&M said Monday it was among the companies that would sign an agreement drafted by global unions to improve safety in the Bangladeshi textile factories it uses.

The collapse of the nine-storey Rana Plaza, which housed five separate garment factories, was the worst industrial disaster in Bangladeshi history and the latest in a long line of deadly tragedies to blight the textile industry.

A fire at a garment factory in Dhaka last November killed 111 workers and a blaze at another plant killed eight people last week.

Bangladesh’s army announced Monday that it was wrapping up its search for bodies at Savar, saying it now believed a total of 1,127 people were killed.

The army general in charge of the marathon recovery effort said that he was now handing over operational control to civilian administrators and expected his troops to be back in their barracks by Tuesday afternoon.

“The army’s recovery operation is almost over,” Brigadier General Siddiqul Alam told AFP.

“We don’t think there are any more bodies in the rubble.”

Many of the three million employed in the industry earn a basic 40 dollars a month, a wage condemned as “slave labour” by Pope Francis.

Muhammad Yunus, the Bangladeshi micro-loan pioneer who won the 2006 Nobel Peace Prize, on Monday urged manufacturers and Western retailers to ensure that garment workers are paid a living wage.

“We don’t want to make Bangladesh a country of slaves. We want to make it a country of modern women. We want to make sure that they get rightful salaries from the world,” he said in Dhaka.

Bangladesh is the world’s second-largest apparel maker and the $20 billion industry accounted for up to 80 percent of annual exports last year.

Some activists have said that wages are kept low as trade unions have been hamstrung by government restrictions.

However the Bangladeshi government on Monday approved changes in the labour laws that would make it easier for trade unions to organise themselves.

Prime Minister Sheikh Hasina’s cabinet “approved some amendments to the labour laws that removed the barriers”, cabinet secretary Musharraf Hossain Bhuiyan told AFP.

The government’s chief factory inspector Habibul Islam also told AFP his department filed cases against 161 garment factories in the Dhaka region and 16 in the city of Chittagong after they failed to ensure safety measures.

“We first issued notices against them to fix their safety related problems at their plants. Then we filed cases against them under the country’s labour laws after they failed to respond to the our notices,” Islam said.

The factory owners face a maximum three months in jail if they’re found guilty, he said.

Many of the criminal notices predate the Rana Plaza disaster and previous government crackdowns have resulted in few actual prosecutions.

H&M, Inditex back Bangladesh worker safety agreement   [ top ]

AFP May 14, 2013
MADRID (AFP) - Global clothing giants Inditex and H&M on Monday promised to sign up to a plan to improve safety for workers in the factories they use in Bangladesh, in the wake of a deadly factory collapse there.

The two said in statements they had agreed to a health-and-safety plan launched by global union federations IndustriALL and UNI Global Union, which represent tens of millions of textile industry workers.

Inditex, the Spanish firm that owns Zara and other major high-street brands, said the deal aimed "to enhance health and safety conditions in the textile industry in Bangladesh by leveraging the commitment pledged by the various players involved in this Asian economy's textile industry".

It said it had communicated to IndustriALL its "resounding commitment to the agreement concerning safety and fire prevention".

H&M, the Swedish high-street fashion giant, said the five-year plan, first launched in 2012, includes appointing an independent chief inspector to "design and implement a fire safety inspection programme that is credible and effective".

It also requires one or more qualified experts to "complete a full and rigorous review of current building standards and regulations" for garment manufacturers.

Activists had set May 15 as a deadline for signing up to the accord.

The full list of signatories has yet to be revealed, but US-based PVH, owner of the Tommy Hilfiger and Calvin Klein brands, and Germany's Tchibo, were among the first to back it, according to anti-sweatshop network The Clean Clothes Campaign.

Monday's announcements came less than three weeks after a nine-storey garment factory complex in a suburb of Dhaka caved in and buried thousands of workers. The death toll from the country's worst industrial disaster on Sunday climbed to 1,126.

Inditex said it had first signed a "framework agreement" with IndustriALL in 2007 "to continually improve labour and safety conditions in textile factories".

There are around 4,500 garment factories in Bangladesh, churning out products for Western fashion labels which sell the clothing at many times the cost price.

The country is the world's second-largest apparel maker and the $20 billion (15 billion euro) industry accounted for up to 80 percent of annual exports last year.

Hundreds of factories which form the hub of Bangladesh's garment industry are to close indefinitely after worker unrest sparked by the accident, the industry's main trade body in the country said Monday.

An Inditex spokesman told AFP the safety agreement would be formally signed at a future date to be set by IndustriALL.

"IndustriALL will publish the details of the agreement in the days to come," the Inditex statement said.

The Clean Clothes Campaign said the two giant companies' commitment to the plan was "monumental news".

It said the agreement will oblige retailers to pay for repairs to make factories in Bangladesh safe.

"H&M and Inditex's decision to sign the legally binding Accord on Fire and Building Safety in Bangladesh is crucial," it said in a statement on Monday.

"Pressure mounts on other key industry players to sign."