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| Top Stories >> Pakistan - Hosiery industry woes highlighted |
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| Pakistan - Hosiery industry woes highlighted |
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 Up to 31 percent abrupt price hike in gas and unprecedented increases in fuel rates have further aggravated the woes of this vibrant sector of the economy. The government knows about the difficulties in the sector. And it is considering continuing the existing RandD support at enhanced rate of 9 percent, but a few individual companies with vested interests are trying to usurp the rights of a majority of SMEs, which are the real contributors towards national economy," he said.
He told a press conference at Lahore Press Club that these vested interests did not make up even 5 percent of the industry but were present in the Economic Coordination Committee and were trying to deprive the remaining 95 percent deserving companies of their rights. "The vested interests, who are in no way representative of industry, have manipulated in the government with proposals to allow RandD support on the basis of performance slabs suitable to their interests which the Economic Coordination Council has deferred for the time being," he added.
He said the Apparel Forum was the real representative of apparel export sector and demands that the support to industry be across the board and should not be confined to the benefit of only a limited number of companies. He said the already disturbed textile sector was satisfied with the exiting procedure of giving RandD support at a fixed percentage of export performance across the board for all exporters--irrespective of big and small exporters.
"The sector consists most of medium and small companies where discriminatory policy to the benefit of only a few exporters would cause agitation, which could also join the ongoing unrest in power loom sector. We therefore want that SMEs should not be neglected and deprived of their due rights; rather they deserve comparatively more support so that they could be uplifted to enhance their RandD activities for promotion of their exports.
The voice about misuse of RandD support is disturbing for the industry as it is against the reality. Associations therefore offer for audit, at their own cost, of their record to the satisfaction of government. We are also ready to accept any other mechanism to safeguard against such apprehensions," he said.
He said the readymade garments and knitwear export sector employs one million labour force and earned 20 percent of total export earning of the country but this vital sector was heading towards collapse. "We want to apprise the economic that the situation is alarming and if the worst situation is not averted by positive and timely acts, it will result not only in the closure of more than 2,000 industrial units but also loss of jobs to about one million workers, whereas a large number of female workers are also earning their livelihood," he said.
He said the government had worked on the textile package to lift this drowning sector but is not reaching any decision. Garment exporters are being given 6 percent Research and Development. The government is said to be considering different options to continue the support but industry demands that only a business friendly mechanism like-wise the ongoing RandD procedure may be adopted.
Another option of launching duty drawback regime is feared would restart a wave of corruption by the drawback disbursing agencies. He said the ongoing procedure of RandD support provided a breath of comfort to the industry because of its transparent, efficient and corruption free procedures. The apparel export industry therefore strongly demands that same procedure should continue in the future with pre-disbursement audit system.
The load shedding and increasing prices of raw materials and other inputs have increased the cost of production manifold and have resulted in production cost hike by not less than 25 percent.
"Governments of our competing countries have provided continuous financial support and hidden subsidies. Recently China has increased the rates of duty drawback for apparel exports from 11 percent to 15 percent putting us at a further disadvantage. In this situation 6 percent RandD support is no more viable. Government should therefore enhance tins support at least to 9 percent before it is too late," he added. He said the nature of garment trade in international market demands a long-term planning and pricing for future contracts.
"But in the absence of timely decisions by government, exporters cannot enter into contracts with foreign importers. If a regular importer shifts his mind from Pakistan, it is impossible to capture him again. A timely decision about textile package from government is the need of the hour," he said. Muhammad Javed Aslam, zonal chairman, Hassan Masood Zaidi, vice chairman and MI Khuram were also present.
Source: Business Recorder |
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