August 3, 2003	Sunday	Jumadi-us-Sani 4, 1424

KARACHI, Aug 2: Both the government and the national industry are moving at snail pace to put in place a framework for social compliance and to gear up the manufacturing units in Pakistan that thrive on export business to implement WTO obligations by January 2005.

The WTO regime becomes operational from January 2005 when foreign buyers will demand from their Pakistani trade partners full and complete social compliance related to labour, environment and health and hygiene. In fact the pressure has started mounting on Pakistan industry from the foreign buyers who are now carrying out social audits of their trade partners and want them to comply with national and international conventions with which Pakistan is a signatory.

Pakistani businessmen are most unhappy on ratification of a large number of International Labour Organisation (ILO) conventions. Pakistan is signatory to ILO conventions 20 and 105 pertaining to forced and bonded labour, ILO convention 87 related to freedom of association, ILO convention 98, which gives right to collective bargain, ILO conventions 100 and 111 call for equal remuneration for male and female workers for works of equal value, ILO convention 135 deals with workers representative convention, ILO convention 138 minimum age, ILO convention 59 vocational rehabilitation and employment of disabled persons ILO convention 177 Universal Declaration of Human Rights and the United Nations convention on the rights of the child.

“There is a need to evaluate the impact of each and every clause on the industry specially the cost to become compliant and consequently the increase in the cost of production due to perforce compliance of such regulation,” a report prepared by a four member Committee pointed out. This report entitled “Textile Industry and Compliance Issues: Social Health and Hygiene and Environment” is the industry perception of the issues that are emerging.

Industry sources said that a few US and EU based buyers had recently carried out a social audit of quite a good number of textile manufacturing units in Punjab. Reports were found to be unsatisfactory. The sponsors have been given a warning to bring health and hygiene conditions up to the required standard and conform their working condition according to the labour laws.

“The European Union has a duty to act to improve the living and working conditions of the workers throughout the world,” was the message conveyed by the WTO as far back as June 1995 when a French held the presidency. This message remained Latin and Greek for an overwhelming majority of the Pakistani entrepreneurs, for whom the only cost cutting method is denying their workers the right to form trade unions and bargain for better wages.

Compliance of hygiene rules and a clean environment has remained for long a wasteful expenditure for Pakistani manufacturers.

The Industrial Relations Ordinance 2002 has evoked hostile sentiments among the workers. The industry also appears to be unhappy on the IRO 2002 as it has fallen far short of businessmen expectations.

Efforts to amend labour laws were initiated only two years ago when the Labour Ordinance 2002 was being drafted. A Committee headed by Mr. Sikandar Khan, chairman, Millat Tractors, was formed with representatives drawn from various sectors of the textile industry.

This committee made 11 recommendations for incorporation in the Industrial Relations Ordinance 2002. Only two recommendations were included in the IRO 2002 and nine other proposals were not incorporated in the final draft.

The final draft of the IRO 2002 included partially the recommendations relating to intimation to the employer of the registration of trade union. The other proposal pertained to compensation in case of termination of a worker.

However, the final draft of IRO 2002 did not include the definition of employer, trade union, workman, outside participation in trade union, act of moral turpitude as one of the act on the basis of which an office-bearer of trade union could be disqualified, cancellation of trade unions and for getting immunity from legal actions for acts done in good faith.

Pakistan industry wants consent of the employer for registration of trade union. The industry also has strong reservations on inclusion of outsiders as office-bearers of trade unions. But the final draft has retained the provision of 25 per cent outside office-bearers in trade unions.

Industrialists demand that labour courts be empowered to cancel the registration of a trade union on complaint of the registrar and also on complaint of the employer and also suo moto.

Under the law female workers cannot be kept in factory premises after 6 in the evening. There are many businessmen who are ready to offer pick and drop facilities to their female workers provided they are allowed to work till 10 in night.

Besides labour issues, there are environment related matters which call for quick action. Processing industry in textiles is key to value-addition. More than 650 units, majority of them small and medium-sized, are in operation in the country. Textile processing is a water intensive process. According to a report 0.8 to 0.15 cubic meters of water is consumed to produce one kg of finished fabric translating into 1000 to 3000 cubic meters of waste water generation in a day against a production of 12 to 20 tons of fabric.

Presently the waste water is being discharged into local environment without any treatment. A wide range of chemicals are used in dyeing which have strong toxic effect and cause environmental degradation.

The Trade Policy 2003-04 has addressed this issue. But with only 17 months left and a large number of sponsors remain indifferent towards this issue, there is hardly any chance of worthwhile improvement.