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Textile policy: Hope for better economy

Textile policy: Hope for better economy

According to newspaper reports, Prime Minister Nawaz Sharif has ordered the enforcement of the new textile policy from the January next year. The policy is under preparation these days and will probably be finalised in the last week of December. The Planning Commission has been tasked with removing lacunae and reservations in the policy while all the stakeholders have also been consulted in the policy matters. Currently, at least 80 percent of the textileexports comprised raw materials, limiting the foreign exchange earing which otherwise could have been much more in case of the export of value added goods.The export of raw material also limitsthe opportunities to adopt new technology in the manufacturing process and generate employment opportunities for the people. Textile exports so far count 60 percent of the total export revenue and more business means more jobs and more security environment in the country.

Pakistan has achieved GSP Plus status on the efforts of Punjab Governor Chaudhry Muhammad Sarwar, but the country could not fully utilized its benefits.The textile exports to European Union have risen to $1 billion in last seven years whereas Bangladesh had brought its exports from mere $5 billion to $25 billion after achieving the same status.There are various fields of economy, including the textile industry, which have the potential to steer the country out of the economic mess. The trend of exporting raw material should end now and the government and the private sector should fully concentrate on the export of value-added good. Though hundreds of thousands of megawatt electricity is likely to be added to the national grid, the electricity shortage is still a problem, hindering the growth of industrial sector. There is a need to provide better cotton seeds to the farmers to get maximum per acre cotton yield and boost the textile sector. One more important point to take into account is that the quality and standard of the exportable goods should strictly be maintained.

Pakistan textile industry has the potential to double its volume of trade in five years if the government facilitates the entrepreneurs with tax relief and provides electricity at subsidized rates. Pakistan has higher interest rates and higher electricity charges in the region, making it impossible for the entrepreneurs to compete with regional competitors in term of facilities and investment.

According to APTMA Chairman SM Tanveer, Pakistan’s exports to the European Union have increased by 29 percentin the first three months of the current year. However, there is a room to materialise the real potential of the GPS plus facility as the exports have continuouslybeen declining for the last six months. The chairman also said that the industry is presently facing the challenges of severe energy shortage, energy affordability, and high cost of production. To overcome the challenges, APTMA is setting up a sustainable production centre for energy efficiencyand water conservation. It is hoped that the government as well as the private sector will develop better understanding and both will work in coordination in the best interest of the nations.