Federal Minister for Industries and Production Mir Hazar Khan Bijarani has said the federal government is preparing an industrial policy in consultation with the Lahore University of Management and Sciences which would be announced soon and asked the Pakistan Tanners Association (PTA) to submit its practicable proposals so that same could be incorporated in the policy.
He disclosed this at a meeting with the PTA members that was presided over by the Punjab Governor Salman Taseer at the Governor House on Thursday. Federal Minister for Petroleum and Natural Resources Syed Naveed Qamar, PTA Central Chairman Khurshid Alam, former Chairman Agha Saiddain, S. Anjum Zafar, and Sheikh M. Naim and senior officials of the Sui Northern Gas Pipeline Limited (SNGPL) were also present on the occasion.
It is pertinent to mention that Punjab Governor Salman Taseer had placed the leather sector's problems before the federal cabinet meeting held in the provincial metropolis a day earlier. On the occasion, Prime Minister Yousaf Raza Gilani had issued directives to the ministers concerned for holding meeting with the PTA office bearers so that their problems could be resolved on priority basis.
The PTA Chairman pointed out that strategic policy for the leather sector was prepared by a foreign consultant J. E. Austin, which is lying pending with the Ministry of Industries and Production and stressed the need for incorporation of the same in the upcoming industrial policy.
Responding to the PTA Chairman, the minister said that his ministry has already placed tentative industrial policy on official website so that it could receive feedback from the stakeholders before giving it a final shape. He assured that useful suggestion would be included in the policy.
About PTA's demand regarding declaring the leather sector a continuous process industry and subsequent exemption from gas loadshedding, the Minister for Petroleum and Natural Resources Syed Naveed Qamar said the government attaches its priority to the domestic consumers and thus supply cut to the industry for a short period. He, however, directed the SNGPL official to hold a separate meeting with the leather sector industrialists so that maximum relief could be provided to them.
Earlier, Khurshid Alam said the export and smuggling of live animals to Iran and Afghanistan is one of the major issues. As per information received, daily about 100 trucks full of cattle are crossing borders to Iran and Afghanistan. The government staff is also involved in smuggling, they have fixed the rate of Rs 2,000 for cow and Rs 500 for goat/sheep, he said.
Unavailability of raw materials in shape of live animal is causing great problem for leather industry for the execution of export orders within the time frame mutually agreed with the potential customers/buyers in general and causing for increasing the price of meat in Pakistan in particular. Apart from this fact in repercussion of War on Terrorism in Swat and Khyber-Pkhtoonkhwa and devastated flood a huge number of animals ie 1.5 million were dead as per official figure released.
The PTA demanded immediate ban on issuance of licenses/quotas for the export of live animals from Pakistan. Smuggling of live animals may be checked. He said that incentives might be given for cattle farming in Pakistan to improve the supply situation of meat along with raw hides and skin.
Alam also said the governments had earlier imposed 20 percent duty on export of raw hides, grains wetblue and wetblue split on the demand of PTA. However, huge lots are being exported out through mis-declaration and under invoicing thus making loss to industry and to the exchequer as well.
He demanded enhancement of export duty upto 50 percent along with minimum export prices as mentioned above (in square feet) to be notified at all dry ports and sea ports for strict compliance to restrict the activities of exporting wet blue hides & skins with the motive to ensure availability of raw materials in Pakistan for meeting the requirement of the Industry for making export after value addition to fetch more precious foreign exchange for the country.
He said load shedding and power failures break down the process due to which hides are destroyed and various quality issues arise. Due to load shedding finished leather valued at US $2.0 comes down to 0.5 cents as a result of electricity load shedding, which is causing production losses. Recently the problem of gas shortage has been increased and 3-day suspension of industrial supply of gas is announced. Annual shut down for three months and in maintenance shut down means that supply of gas would remain discontinue for 70 percent in a year, he maintained.
The chairman PTA said that total estimated electricity load of tanning industry of Pakistan is around 55-58MW whereas for natural gas, it comes to around 17-18 mmcfd which is not unmanageable. He further told the federal ministers that leather industry could enhance its export to US $1.5billion existing if uninterrupted supply of electricity and natural gas is assured. He also suggested the Ministry to consider providing efficient burners at "tandoors", hotel and restaurants for optimum gas consumption.
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