Textile sector contributes 56% export earnings: FPCCI president

KARACHI: The textile sector contributes 56% share in the total export earnings of Pakistan but still we have less than 1% share in the global textile trade. Our competitors like India, China, Bangladesh, Vietnam and Thailand are getting benefits from their governments in terms of tax credit and utility charges. The harsh steps of our government also benefit our competitors because these steps increase the cost of doing business in the industries and make their product in-competent in the global market.

This was stated by Zakaria Usman, President FPCCI in a meeting with Abbas Khan Afridi, Federal Minister for Textile Industry who visited Federation House, Karachi to meet the President and Office-bearers and other members of business community. He was accompanied by Ms Rukhsana Shah, Secretary Textile Industry. The meeting was also attended by Shaukat Ahmed, Sr Vice President, Khurram Sayeed, Ismail Suttar, Mian Mehmood, Naima Ansari Vice Presidents of FPCCI and prominent industrialist Dr Mirza Ikhtiar Baig, Anwar Ahmed Tata and Haji Shafiqur Rehman.

Usman said that the export of our textile products heavily dependent on few international markets like EU and USA and we should diversify our products and work on branding and packaging to make our products exclusive and attractive. Moreover, we have to upgrade our textile industries in terms of technology, machinery and skilled/technical labour. The vendor industry of textile in Pakistan should be developed and encouraged. He also stressed on the need of technical and skilled labour for which the government should establish textile specialized institutions in all major cities.

The President FPCCI further said that we have not yet penetrated the benefits of GSP plus status. The government should also start to resolve those issues which can revoke the GSP plus status in future. We must learn lessons from Bangladesh who has been warned by USA and EU to update their labour laws. The government should update the labour laws in Pakistan.

Zakaria appreciated the vision of the government to establish EXIM Bank which will finance for long-term to the textile industries in import of machineries and short term export refinancing on 50% reduced rate of normal rate of interest.

He said on the other hand, the government has increased the rate of GIDC from Rs.100 to 300 per MMBTU will increase the cost of doing business in the industries. The government should revisit this decision and keep it on previous slabs because this harsh step would only benefit our competitors which will lead to drastic decline in the textile exports of Pakistan and ultimately it will jeopardize the benefits of GSP plus.

Abbas Khan Afridi, Federal Minister for Textile Industry who met the President FPCCI to discuss the various issues pertaining to forthcoming textile policy of the government, said that as Federal Minister he believed on the fact that the rate of GST should be reduced to 0%. He said that the export of raw material was not beneficial for any country. “We should promote value added industries to fetch better prices from international market. He further said that the textile ministry would fully support FPCCI in the matter of textile industries in the forthcoming textile policy.

The federal minister further said that we should focus on the expansion of our industries and concentrate on the ways and means to enhance the production. In textile sector, we should increase stitching units in our textile industry for surplus production to further enhance the export of the country.

In a question regarding GIDC, the federal minister said that he would meet the finance minister next week to discuss GIDC and hopefully it would be settled down in next week as discussions on GIDC was continuously going on.

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