February 24, 2003	Monday	Zul Hijjah 22, 1423

The textile industry is of paramount importance due to its contribution to the GDP, export earnings and employment. It has basic strength in terms of strong raw material base and favourable labour cost. In a highly competitive environment, these inherent strengths are out-numbered by the weaknesses. Although Pakistan ranks fourth among the cotton producing countries, but most of it’s ginning factories are old and obsolete.

Contamination causes yearly a loss of around $1.4-2 billion in raw cotton export. The issue of stagnant production could be resolved by the cultivation of the BT seeds, which is being successfully used by many countries. Deficient and rudimentary infrastructure, limited water and power with regular tariff increase does not allow this industry to realize its full potentials.

Global market: The international image of our textile industry is that of supplier of yarn, grey fabric and low-end garments. As a consequence, our unit value realization is one of the lowest in the world. Small-scale industry, fragmented powerloom sector and wet-processing units, along with the obsolete technology have faltered the quality, thus tarnishing the image of the industry. Only composite mills, which have the capacity to absorb high technology and achieve economies of scale can compete internationally.

The industrial policy in terms of growth has brought it to where it is today. Our global share in the textile trade is approximately 1 per cent and has remained stagnant since many years. In contrast, China’s exports grew from $5 billion in 1983 to $45.5 billion in 1997, and combined with Hong Kong it stood at $78 billion. Globalization can be an opportunity for Pakistan. The huge global textile trade of $400 billion, growing at 3 per cent annually provides ample opportunities.

Textile industry is one of the potential sources of ecological pollution, which is irreversible, and it’s damage is a permanent blow. A continuous increase of undesirable elements and concentration of these foreign bodies in air and water beyond human tolerance causes pollution and manifests in various symptoms of toxicity in human beings.

In the environmental management system(EMS) our performance is dismal. The office of the “Environmental Protection Agency, Government of Sindh” is located in the Korangi Industrial Area. This area houses many important textile, food and pharmaceutical industries, and presents the most unhygienic and pathetic condition. The road network is in poor condition and frequently flooded with gutter water. Sector 29 is probably one of the most polluted area. While the marketing of products destined for developed countries is increasingly influenced by the consumer-concerns on environmental, social and health issues in the countries of production.

Producers with environmentally unsound production processes may find it increasingly difficult to gain market access to the countries, where environmental awareness is highly developed. Companies can get their EMS certified according to the ISO 14000, worldwide acknowledged for the EMS.

Investment in human resources: Investment in employee training is a prerequisite for the successful future of the textile industry. Brazil with a turnover of approximately more than $20 billion has the biggest training centre, the CETIQT which churns around 4000 students per year in technical courses. Testing laboratories with the state-of-art equipment are available at the CETIQT, supported on a generous scale by Unido and well-known European firms.

Investment in human resources is on low priority in Pakistan due to the lack of funds, the non-availability of trained teachers and the administration of institutes by unprofessionals. The out-dated curriculum, instructional methods, lack of funds, cannot be expected to make any contribution in developing competent technical human resources, who are promptly needed to achieve the higher level of success in marketing the value-added goods.

Textile Vision 2005: This envisages increase in exports from $5 billion in 1998 to $14 billion by 2005, which requires an investment of Rs333 billion up to 2005, for modernizing the entire textile and clothing sector. The initiative taken so far have been at best sporadic and faltering. As a result of this unpreparedness to face the challenges of globalization, Pakistan’s present position in top ten Asian countries is at stake. The 11/9 episode has been instrumental in tariff free access to the European Union markets, upward revision of quota by 15 per cent, and a modest relief of $142 million by the US. But, this development should not be attributed to any significant upgrading in our textile manufacturing sector, this is only a temporary phase. Steps should be adopted without further delay to strengthen the Pakistan textile industry so that it has the resilience and capacity to meet the global challenges of phasing out of the multifibre agreement by the WTO.

Gearing up for 2005: With the dismantling of quota regime from January 1, 2005 there will be stiff competition in the international market for textiles and clothing. In competitive environment, efficiency, economy and ecology is synonymous with technological excellence. Only those countries, which have the advantage of cost-effectiveness, upgrading of quality and ability to respond in time will be in a position to retain and possibly gain larger share in the global trade.

In a highly competitive environment, the ability to understand a product’s quality and to market it has become a professional skill. Constant change is the challenge and the steps taken so far are inadequate. The trade policy for 2002-07 announced by India contains many features that would give a fillip to its textile exports. One of its features is the accent on infrastructure and procedure simplification, with several measures such as the extension of period for the realization of export proceeds from 180 days to 360 days. Exporters can maintain 100 per cent foreign exchange in their EEFC accounts, cheaper export credit and number of concessions in income tax, sales tax for local supplies. The setting up of export excellence centres, and neutralization of refuel costs are all intended to increase the country’s global share to $50 billion by 2010.

India has also adopted special scheme namely the “Mark Access Initiative (MAI)” for introducing the Indian companies to various markets. The strategy of promotion council involves three key objects (i) the product focus; (ii) the market focus; (iii) the opening of new markets and sustaining the performance. The long-term strategy of the council is to sustain and strengthen the image of India as a reliable source of quality and competitive price. The Indian ministry of textiles, have taken a number of pro-active measures including duty concession on the import of capital goods, quality upgradation, training technology up-grading scheme (TUS) and providing comprehensive textile and the eco testing facilities through the network of laboratories.

Building Pakistan’s competence: While export opportunities can increase manifold, competition will heighten tremendously, judging the textile exporters ability to survive in the global market against competitors from China, Indonesia, Thailand, and Turkey. Our government and the entrepreneurs have to take number of proactive measures such as:

— The modernization of industry

— Adequate infrastructure as a prerequisite for the development of technology

— Quality upgrading;

— Halting the usage of dyes such as the AZO, and the chemicals which are carcinogenic, allergic and poisonous;

— Using only eco-friendly products;

— Implementation of the EMS (ISO 1400Q and SA (8000);

— Qualified and trained manpower;

— Minimization of seconds, rejects and reworking would have a significant bearing on per unit cost and competitive marketability;

— Strict quality control;

— Accredited laboratories.

Conclusion: It is regretted that Pakistan’s forex earning from textile export has been poor. Textile mills can earn substantial foreign exchange if they export-value added goods instead of yarn or grey cloth. In a time of globalization it is natural that our industry is keeping in line by looking for new ways and approaches to meet the standards brought about by the phasing out of the quota and the new demands made by an increasingly quality conscious public.