Players in the textile industry are pushing for the implementation of a National Textile Policy, 2009, which they say would among others help in providing meaningful policy direction to the sector and mandate government institutions to buy textiles from local companies.
Once implemented, according to Mr Vinay Kumar, Nytil’s general manager, Nyanza Textile Industries Limited, the police would enable textile companies access to concessional financing for investment.
“Due to policy gaps arising as a result of failed policy implementation, some companies collapsed because of unfair competition with imports that are hugely subsidised,” said Mr Williams Okello, the logistics manager at Nytil.
He told MPs who were on touring the company’s factory on Friday that several textile companies in Uganda are idle despite abundant cotton grown in Lango and Acholi sub regions.
“No new investment is coming on board despite Uganda’s comparative advantage premised on availability of medium staple cotton,” he said.
The Nytil management noted that despite the fact that they produce various products including locally made army uniforms, government does not buy from them.
“We are asking government to establish a comprehensive Universal Primary Education and Universal Secondary Education uniform supply chain value chain to enhance the consumption of locally-grown cotton lint so that cotton farmers get better gate prices,” he said.
Although the government announced the first ever 5 year National Textile Policy but despite calls for its implementation, it has not been implemented.
The company owned by the Picfare Group of companies, is seeking a 25 per cent VAT waiver, equivalent to more than Shs5 billion in order to sustain its operations
“Its collapse is catastrophic to not only 2,500 Ugandans who derive direct livelihood from the company but also to the cotton industry generally that employs some 2.5 million Ugandans at various levels of the value chain,” said the company’s publicist, Mr Caleb Ainebingi.
Ministry of Finance spokesperson, Mr Jim Mugunga recently advised Nytil officials to petition the ministry to handle their concerns.