The Pakistan Textile Exporters Association (PTEA) has expressed deep concern over drop of 6.38 percent in textile exports in December 2014 despite the availability of GSP Plus benefit. Unprecedented energy shortage and lack of working capital are the prime reasons behind the substantial drop in exports.
Commenting over the prevailing situation, Sohail Pasha, Chairman, and Rizwan Riaz, Vice Chairman of the PTEA, apprehended that export numbers in coming months might be even worse as the textile industry in Punjab has been deprived of its basic fuel and working capital and textile exports witnessed 6.38 percent decline in December over the same month of the outgoing fiscal. Giving details, they said that the country exported textile goods worth $1.175 billion in December as against exports of $1.255 billion in the same month of previous year showing a big decline of 6.38 percent. Export of value added items also witnessed negative growth as cotton cloth down by 13.62 percent, bed wear 11.54 percent, towels 11.39 percent and textile made-ups 10.04 percent.
Slow poisoning of economy is being precipitated due to the non-serious attitude of the government as exports of the country are heading towards collapse after visible decline, they said. Energy shortage and liquidity crunch are the prime causes of decline in exports as major part of production capacity of the textile industry is dysfunctional due to short supply of electricity and gas. Drop in exports would have serious consequences for the economy but the government is not addressing the reasons behind the drop in exports, they deplored.
Policymakers are not serious in resolving the gas supply issue of the textile industry. Instead the available gas is being supplied to the unproductive sectors, causing a loss in terms of foreign exchange, they argued. Situation is becoming unbearable for the industry as constant inefficiency is plaguing the viability of production units. Even, the GSP Plus facility has not bring in any desired results and efforts have also gone wasted as we are unable to produce export surplus due to massive energy constraints, they said. Acute energy shortage has chucked the Punjab industry in a bottomless crisis and due to this jobs of thousands of workers are in danger as closure of industry has been started, they added.
PTEA Chairman Sohail Pasha was of the view that non-availability of energy and stuck up liquidity on drawbacks and refunds have played a vital role in the lower growth and exports of Pakistan textile industry. Drop in exports and the health of textile sector is being taken up by PTEA at various forums but the government does not understand the gravity of the situation and no step is taken to ratify the situation. Now is the time that the repair has to be made otherwise decline in exports would put irreparable loss to economy. He criticised the policies, which had failed to encourage investment in the textile sector during last five years whereas competitors made huge investments due to the positive and business friendly environment provided by their governments. Rivals, taking advantage of the situation, are creeping into our traditional markets throwing Pakistani textiles out. Less increase in exports than non-GSP Plus India is not a good omen for Pakistan, as India's extraordinary surge in exports reveals the preparedness of the Indians to deal with the GSP Plus advantage of Pakistan. It also shows the non-professional approach of the state machinery dealing with textiles, he said.
The PTEA urged the government to take stock of the situation and step up to save the largest export earning industry of the country by restoring viability of textile industry through provision of uninterrupted energy supply at competitive rates and immediate release of unsettled refunds.
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