KARACHI, Oct 3: Growth in knitwear exports to the US after the removal of quotas from January 2005 remained sluggish as compared to China, India and Bangladesh which registered a manifold increase during the same period.
According to a study carried out by a textile body, the growth in Pakistan’s knitwear exports to the US was the slowest as compared to these countries which are main competitors in textile exports.
A fast running category 338 (men’s upper) during the period under review recorded a growth of 21.74 per cent, whereas exports from China of this category scrambled by 1,241.03 per cent. Similarly, exports of this category from India registered a rise of 117.43 per cent and Bangladesh 232.19 per cent.
It is astonishing to note that per dozen price of this category quoted and received by Indian exporters stood higher than what Pakistani exporters received but still the growth in exports remained much lower than India. The average per dozen price quoted by Indian exporters stood at $40 and by Pakistani exporters at $38. The price received by Bangladeshi exporters stood at $26 per dozen, which is the lowest, and by Chinese exporters at $30.
The apparel industry had been the weakest link in Pakistan’s entire textiles and clothing sector, and this is the area where marketing skills and added value is bagged. But today Pakistan is fast becoming a semi-finished raw material exporting country and is feeding other nations’ apparel industry by making available yarn and fabrics.
It may be true that trade deficit was widening owing to costlier bill of POL imports and large imports of capital goods, but it could not be denied that if country’s exports have picked up in proportion there the situation could have been better.
Pakistan Hosiery Manufacturers Association’s former chairman Aslam Ahmed Karsaz pointed out that almost all the three countries -– India, China and Bangladesh -– were giving several hidden benefits in the shape of subsidies to their exporters.
On the contrary, he said, the local industry was faced with several problems and even positive and good policies announced were not implemented in letter and spirit.
Citing an example, he pointed out that the removal of sales tax was a good step by the CBR, but presently billions of rupees were stuck up with the CBR in the shape of refunds pertaining to the period prior to giving a zero-rate status to five major export industries. “This has not only created liquidity problems for the export sector, but also a large number of export contracts have been cancelled.”
He agreed that some unscrupulous elements might have submitted a large number of ‘flying invoices’ at the last minute to fleece the national exchequer, but there was no reason as to why genuine exporters should suffer on this account and get their export markets damaged.
Similarly, Mr Karsaz said the commerce ministry had taken a good measure by giving research and development support to the garment sector, but so far only 20 to 25 per cent of claims had been settled while a large number of genuine claims were still held up because of procedural difficulties.
He requested Commerce Minister Humyaun Akhtar Khan to simplify the procedure for R&D claims as the exporters could not afford to waste time in ambiguities and complicated methods of getting the amount on this account.
Mr Karsaz warned that the apparel sector would totally collapse if the government failed to take appropriate measures. “The ministry of commerce should hold a joint meeting with trade bodies to find a way-out so that the value-added sector is saved and much needed foreign exchange is earned from our cash crop of cotton at its maximum value and price. There is also a need for evolving market strategy to ward off competition from neighbouring countries of the region,” he concluded.
