June 17, 2002	Monday	Rabi-us-Sani 5, 1423

In backdrop of an economic growth of 3 to 3.5 per cent during the current fiscal year, textile remains the leader showing a growth of 4.4 per cent in nine months of 01-02 compared to 2.7 per cent in same period of last fiscal.

Thanks to a massive revamping, balancing, modernisation and restructuring of the textile industry since the year 2000 with an estimated investment of over one billion dollars, the industry faced successfully the most hostile trading conditions within the country and outside in the current fiscal year.

Business conditions were far from bright when the fiscal 01-02 set in July. Then it took a turn to worse on September 11, 2001 when twin world towers in New York and the huge Pentagon building in Washington were razed to ground from an aerial attack. Situation aggravated further on October 7, 2001 when tiny Afghanistan came under attack of the coalition of mighty powers of the world. And then an attack on Indian parliament building in New Delhi on December 13 triggered off a chain of events which continue to cast war shadows on sub- continent till this day and business remains a difficult activity.

Export orders were cancelled. Textile companies complained that their buyers were reluctant to place orders for autumn and winter. War risk surcharge raised insurance premia and the transportation cost increased. National economic growth is now being estimated at 3.2 per cent but textile somehow or the other managed to show resilience.

The State Bank of Pakistan’s third quarterly report released on Wednesday calls the improved performance of textile during third quarter of the current fiscal year as “most significant”. “Despite the depressed market conditions prevailing in the global economy during this period, this sub sector (textiles) showed 4.4 per cent growth”.

Textile engages almost 70 per cent of Pakistan’s population directly and indirectly, if one starts counting people right from the cotton plantation to value-added products. A good cotton crop, with equally good money for farmers and conditions of steady supply to the local industry means generation of more jobs and some prosperity in the country.

Realising the importance of textiles in the large scale manufacturing sector, the government for a change, is taking decisions well in time this year. Phutti prices have been announced on Wednesday (June 12) and have been increased by Rs 20 on a maund, from Rs 780 to Rs 800 a maund.

Farm credit issue will be discussed in depth and detail at a big gathering of farmers and bankers in Karachi on June 28. Farmers want a separate farm credit portfolio for themselves. They are not happy on the existing arrangement of agricultural credit sanctioning and disbursement.

For the first time, the government is making a serious effort to address the conflicting interests within sub sectors of the textile. For last more than 50 years, the advent of cotton season from September has been marked by fiery statements from the leaders of farmers, ginners, spinners and the ancillary on prices, supply, purchase and export of phutti, cotton and yarn.

Anticipating a fire work again, the Federal Textile Board has constituted eight sectoral committees. Sectoral committees have been formed on cotton, yarn, synthetic textiles, fibres and filaments, cotton and synthetic cloth, home textiles (Bedwear, towels, made ups), clothings, marketing (global and domestic trade) and fiscal and finance.

Conveners of all these eight committees have been appointed. All these conveners are reported to have held a meeting among themselves and worked out modalities of the working of each of their committees. Now every convener has started holding meeting of his committee. In about next two weeks, all these committees are expected to finalise their findings in their respective areas.

The conveners of all these eight committees then weave together the findings and recommendations of eight committees into a single policy package. The industry leaders are confident that this policy package would ensure equal and fair opportunities to all segments of textile industry.

It will address the issues of conflicting interest and for a change one can expect that there would be no trading of statements between the leaders of farmers and ginners and the spinners. Spinners will export yarn but ensure steady supply to the domestic ancillary.

Iqbal Ibrahim managing the giant Al Karam looks the year 02-03 with hope and confidence. He said that the current fiscal year has proved to be tough. “Nonetheless, we managed to improve our volume in exports but were not able to get a good price” he remarked.

Textile prices remained under pressure in all parts of the world and Pakistan suffered about 10 per cent loss on this count. He said that he was right now engaged in complying with autumn-winter orders but hope to get a better price for next spring-summer orders.

Textile dealers foresee cotton prices going up this year because the USA authorities are offering attractive “set aside” subsidies to their farmers. Farmers are being asked to skip cotton plantation this season in USA so that prices could go up. “All depends on China” Iqbal said. Qazi Sajid, Chief executive of a chemical multinational expects a fast recovery in the next fiscal. He said that chemicals registered a negative growth this fiscal. Leather industry remained stagnant and textiles was not upto its full potential.

But there are indications that demands are coming on in the leather products and textile will gradually pick up. Chemicals is bound to take a big leap in production and marketing next fiscal.

“We have grown cotton on less area in Sindh” Syed Qamaruzzaman Shah informed this correspondent on telephone. He said water scarcity has hit hard the farmers in Sindh. It is not only the water scarcity but worn out barrages and canal system that is depleting water releases.

Rohri is one the most fertile area of Sindh which used to get 16,000 to 18,000 cusecs of water every day. Lack of proper maintenance and non- repairs have reduced the capacity and Qaramuzzaman Shah said that they would be lucky to get 10,000 cusecs of water a day.

He said that banks were distorting the agriculture credit distribution figures. Cost of a storage is too big and need quite a big amount of loan that would be sufficient for 50 small farmers. The farmers therefore want segregation of all agricultural loans.

Defaults in agriculture loaning were created when the Agriculture Development Bank started offering credits for agro- based industries. “Now all farmers are blamed for the stuck up loans by these new class of agro industrialists” he remarked angrily.

Agricultural growth has been reversed to positive this year from negative last year. Planners pin their hopes in early summer rains which should ensure a good sugar-cane and rice crop with cotton. Some floods in the river will leave behind fertile soil for wheat plantation and if this happens a five to six per cent growth in agriculture would do well.