Pakistan Textile Exporters Association (PTEA) has stressed the need for creating a stable environment with more market access to deal with competitiveness issue as country's textile industry has lost its viability against regional competitors. Textile industry is the only hope for revival of country's economy which is currently jolted by high cost of doing business.
Commenting over the prevailing situation on Thursday, Sohail Pasha, Chairman of the Association pointed out that, textile industry, economy's mainstay is facing unprecedented crisis since many years. Consequently, sizeable textile capacity had been severely impaired and textile exports, both in quantity and value terms had declined across the value chain. The major factor behind the declining trend is the erosion of textile industry's competitiveness, particularly against the huge incentives being provided by the competing countries to their export sectors. With Government support, regional rivals have accelerated export growth and have increased their market share in global textile trade. Quoting the growth rate, he said that textile export growth in Bangladesh is 20%, India 12% and China 12%; whereas in Pakistan is just 3%. With such speedy growth, Bangladesh has increased its share in global textile trade from 1.09% in 2006 to 3.30% in 2013. Similarly, India increased from 3.4% to 4.70%, China from 27% to 37% while Pakistan has dropped from 2.20% to 1.80%. If growth factors remain the same, Bangladesh's share in world market in 2020 would be 6%, India's 7%, China's 56% and Pakistan will be limited to 1.50%, he opined.
PTEA's group leader Ahmad Kamal was of the view that Pakistan's textile exports were too close to Indian textile exports few years back but with 5% industrial growth rate, their annual textile exports have crossed USD33billion mark. Due to conducive policies, heavy investment was made in terms of machinery in competing countries. During 2008-13 periods, China added further 35.29million spindles; while India added 14.20million and Bangladesh added 1.98million spindles in textile sector. In Pakistan, only 1.02million spindles were added in five years. Comparing the results of first five year textile policy 2009-14 with India's 11th five year plan 2007-12, he said that implementation of country's first ever textile policy 2009-14 with outlay of Rs188billion was implemented just 15% which results 0% growth in textile exports, only 1million spindle addition, no new jobs created and world market share dropped from 2.2% to 1.8%. On the other hand, India's 11th five year plan 2007-12 with outlay of Rs140billion was implemented by 115% bringing 76% increase in exports, 14 million spindle addition, creation of 16million direct job and increase in world market share from 3.5% to 5%.
Vice Chairman PTEA, Rizwan Riaz Saigal said that the cost of doing business in the textile sector has sky rocketed and the burden of incidental taxes, provincial cess, system inefficiencies and the punitive withholding tax regime have added fuel to the fire. Government should provide level playing field to double its existing share in global textile trade.
PTEA urged the government to restore the competitiveness of the industry by ensuring uninterrupted supply of gas and electricity at regionally affordable rates, liquidation of all pending refunds, removal of all innovative taxes and restoration of zero rating regimes for textile export chain.
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