Value-added textile sector has rejected the phenomenon of free market mechanism for exporting of yarn and said that this system has been badly rejected globally as it has failed to produce desired results. Bangladesh banned the export of Jute to Pakistan in its greater national interest.
This was stated by Khurram Mukhtar, Chairman and Sohail Pasha, Vice Chairman Pakistan Textile Exporters Association (PTEA) briefing the newsmen after review joint meeting of Pakistan Textile Exporters Association Chairman All Pakistan Textile Processing Mills Association, Mian Aftab Ahmad, Chairman All Pakistan Cotton Powerlooms Association, Rana Ikhlaq Ahmad, Chairman Save Power loom Movement, Waheed Khaliq Ramay, Chairman Sportswear Manufacturers Association, Sialkot, Zia Ur Rehman and Chairman All Pakistan Bed sheet and Upholstery Manufacturers Association, Multan on the second day of "Save Value-Added Textile Industry - Save the Country" Campaign here on Wednesday.
He said that unrestrained export of cotton and cotton yarn are badly affecting the value added textile industry of the country, as this essential raw material is being exported at the cheap rate to rival countries. While the national labour-intensive textile industry and precious foreign exchange earned from textile exports are collapsing due to high cost of doing business and being incompetetive in international market.
Khurram Mukhtar said that all textile Associations have unanimously declared that there is no free market economy mechanism practically working in Pakistan as there is protection available to the raw material manufacturers in Pakistan in shape of custom duty and anti-dumping duty on Polyester Fibre and Custom Duty on the import of yarn into Pakistan.
He said that this free market phenomenon has been badly rejected globally as it has not brought fruitful results, instead the regulated economies have shown exceptional growth such as "BRIC" countries, including Brazil, Russia, India and China.
He said that trade deficit is a major economic problem and the Value-Added Textile Industry is the only sector in Pakistan, which has potential to enhance export growth, but can also generate millions of jobs, besides the handsome revenue.
Textile Industry was badly neglected in the past, he said. In the history of Pakistan, for the first time a comprehensive five-year Textile Policy has been announced having incentives across the board, he added.
The export target of $25 billion is not impossible as this is a balanced policy that has ever been announced in Pakistan and all the credit goes to the Federal Minister for Textile Industry and his whole team who have taken all stakeholders on board.
But now there is a certain lobby who is trying to sabotage the objectives of the policy. He said, "We exported Textiles worth $9.60 billion last year and the export target of $12 billion for current fiscal is highly unlikely to be achieved." He apprised the authorities concerned that if same momentum of export of raw cotton and yarn export continues, then we will have to import yarn in April 2010 and the whole value added chain would collapse.
Not only Value Added Textile Industry, but also other ancillary industries like dyes and chemical manufacturers, accessories manufacturers, packaging Industry, paper mills, services sector have started feeling heat, he said. The collapse of this sector will not only bring losses of about 15 million jobs, but also the economy of the country will have long lasting disastrous effects, and we will never be able to come out of this vicious cycle, he added.
They said that there is no sense in exporting raw material to the rival countries, as they are regulating their own economies. They regulate supply of raw material for their domestic industry and export only surplus quantity but unfortunately there is no regulatory authority in Pakistan. There is serious shortage of yarn all-over the country as we have exported 284,000 tons of yarn in the first four months whereas last year about 500,000 tonnes of yarn was exported, he said.
Last four years data maintained by the government shows that 79 percent yarn was consumed domestically and only 21 percent yarn was exported therefore our demand of putting cap on the export of yarn based on last four years export average volume is legitimate, which is in the national interest, he added.
Raw cotton production is short all-over the world except India who is expected to have four million surplus bales as their consumption is 24 million bales against the expected production of 28 to 29 million bales, they said. Pakistan always had the edge of raw cotton so this is the fundamental right of domestic Value Added Textile Industry to get constant supply of yarn and Ministry of Textile Industry must play its due role, he said.
In case of any delay millions of workers would be rendered jobless, Pakistani textiles will lose its place in the International market as the country is already confronted with challenges, he warned. "We have recent example of Bangladesh who has imposed ban on raw jute export. Raw cotton export should be banned immediately until the next season, he said
Khurram Mukhtar appealed to President of Pakistan Asif Ali Zardari and Prime Minister Syed Yousuf Raza Gilani to immediately intervene in this high time and save all the value added textile industry from total collapse by capping yarn export to last four years average export volume and by immediately banning export of raw cotton. He further appealed to Chief Justice of Pakistan Chaudhry Iftikhar to take suo motu notice of the current situation and save all the value added Textile Industry from total collapse.
Chairman PTEA further reiterated that they reserve the right to take the matter to Competition Commission of Pakistan (CCP) by December 15, 2009 by exercising their fundamental right of consumer protection. Chairmen of all Associations took a policy decision that they will go for nation-wide campaign in the national interest of Pakistan.
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