To exploit the true potential of non-textile sectors, the government needs to prioritise them and improve research work and value addition which will boost exports, said Muzaffar Hussain Khan Magasi, Chief of Seraiki Inqilabi Council.
This is for the first time that the government has announced a textile policy separate from the trade policy. With this development, non-textile sectors have taken a sigh of relief and hope this time they will get government attention and support. When asked why non-textile sectors had always been overshadowed by the textile industry, he replied: "Pakistan has been a cotton-producing country and, therefore, the availability of raw material over the years attracts investment in the textile industry.
The question is why successive governments have failed to widen the export base and always depend on the textile industry? "We have been suggesting to the governments since 1993 to increase exports by targeting potential sectors other than textile," he said, adding despite the long delay the present government had finally made its mind and seemed ready to take up the challenge and develop non-traditional export sectors.
"He said the industry was being protected throughout the world and at this point in time when country's industry was facing a tough time in the backdrop of high cost of production and power crisis, the government should provide support to certain industries.
"Now the government needs to take a targeted approach and provide stimulus to the industry by helping reduce the rising cost of production and high lending rates," he added.
Pointing to the high banking spread, the difference between the rate of return the bank pays to its depositors and the mark-up it charges from borrowers, he said seven percent banking spread should be cut down, which was one of the highest in the world. He also highlighted two grave problems, which had been hindering industrial and business growth, saying the government should tackle power crisis and law and order problem. The government has unveiled a three-year trade policy with Strategic Trade Policy Framework to increase trade and export base. Businessmen think that the trade policy will help improve trade and commerce but at the same time caution that the implementation of the policy in 2009-12 is a gigantic task for the government.
The textile sector, having a share of 54 percent in exports, posted a decline of $1 billion to $9.6 billion in 2008-09 from $10.6 in the previous fiscal year. In 2008-09, three sectors showed a significant growth in exports despite the financial crisis that badly hit world trade. These included engineering exports, which registered an increase of 26.1 percent to $266 million, jewellery exports which rose 35 percent to $288 million and rice exports which grew 8.2 percent to $1.99 billion. Some of the potential non-textile sectors which grew in recent years were food commodities with exports of $3.02 billion, cement $577 million, surgical and cutlery $298 million, chemical and pharmaceutical products $606 million and sport goods $274 million.
Khawaja Muhammad Jalaluddin Roomi, former Punjab Minister for Industries commenting on the recently announced trade policy said the government had vowed to increase exports but it had to go a long way. "I believe policy formulation and its implementation are two different things," he added. For the textile sector especially, the government needed to formulate consistent policies for competition with regional countries and achieve access to export markets.
"Without value addition we cannot achieve a quantum leap in exports while raw material exports like cotton can never replace value added textile products," he stressed. He, however, praised the increase in exports of engineering goods and gems and jewellery in fiscal year 2008-09 and said there were lots of opportunities in both sectors.
Citing India, he said the country had acquired phenomenal expertise in jewellery-making and increased its exports to billions of dollars. The mindset of exporters was also responsible for unsatisfactory exports as "our exporters stick to traditional products and hesitate to search for new sectors and products."
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