Tiles industry can help government in achieving job, revenue generation targets

Pakistan's tiles industry can help the new government to achieve its target of employment creation and revenue generation. The reviving economy is one of the biggest challenges for the new government while its target of creating jobs for youth and boost exports are the way forward to achieve economic prosperity.
Chief Executive Officer Shabbir Tiles Limited, Masood Jaffery while speaking to a group of select journalists said that Pakistan's unemployment rate reached to 4.04 percent level in 2017 as compared to 1.83 percent back in 2014, while current account deficit and negative balance of payments are also contributing heavily to the deteriorating economy.
"The government has to identify sectors of economy which have untapped potential to grow exponentially, create employment opportunities, ensure technological transfer and contribute to GDP and exports," he said.
He said that local tiles industry is one of those sectors that can help the government achieve its targets and the industry is willing to invest in capacity enhancement to further increase its production provided that the government supports the industry.
He said the direct and indirect employment size of the local tiles market is over 50,000.
"The local tiles industry is producing quality products that are comparable to top global tiles manufacturers, hence a big opportunity for employment generation," he added.
Now, he added, the government should support the local tiles industry to increase its capacity for better output.
"International standard companies are operating in our local industry and Stile is one such example.
Also, he added, the local industry has enormous export potential that needs to be exploited.
"Support from the government in the form of reduction in the energy and input costs and imposition of taxes and duties on imported tiles will not only save precious foreign exchange for the government but also enable the local industry to export tiles to the neighbouring countries," he added.
He asked the government to support the tiles industry by curbing smuggling and providing the industry level playing field against the heavily favoured imports by dint of lower valuations.
The Import trade Prices (ITPs) have decreased in the last 10 years in Pakistan, while manufacturing cost has increased drastically in Pakistan while rupee devaluation against dollar is also affecting the business environment.
"ITPs are too low based on the scenario where the minimum wages, energy cost and various other inputs have increased manifolds around the world," he said adding that the government should carefully review the ITPs set for tiles based on the data that can be sought from exporting countries and withdraw the unfair advantage imported tiles are enjoying due to unrealistic valuation.
The government should focus on curbing smuggling of tiles into Pakistan because this is the biggest issue that is preventing the local industry from achieving growth - the basis for employment generation and revenue increase, he added.
It is to be noted that total official imports are 22,020,000 sq meter and total smuggling from Iran is 13,380,000 sq meter.
This shows the magnitude of the damage being done to the local industry by smuggling. The smuggling is increasing day by day which is hurting local tiles manufacturers, while tax and duty evasion due to smuggling and low ITPs are the factors hurting the government revenues as well, he added.