April 11, 2006	Tuesday	Rabi-ul-Awwal 12, 1427

ISLAMABAD, April 10: The World Bank has urged the government to seriously concentrate on improving the “low productivity and efficiency” of the textile, garments and apparel industries, failing which it will not reap the benefits in the post textile quota regime, effective from January 2005.

Informed sources told Dawn here on Monday that the World Bank maintained that the impact of quota elimination for Pakistan would be serious as a result of growing competition from other countries.

The implication for the apparel sector, the WB believed, could be more serious, if no action was taken to improve the much needed productivity and efficiency.

Pakistan’s per capita productivity has been estimated by the WB at only 37 per cent of the benchmark established by China.

Compared to this the Indian per capita productivity is also better at 46 per cent.

“For Pakistan, raising productivity by improving the efficiency of the production process is a key to reaping benefits from the abolition of Multi-fibre Agreement (MFA),” a source quoting WB officials said. If, for example, Pakistan is able to increase its productivity in textile and clothing sector by around 60 per cent to reach China’s productivity level, the gain would likely to be over $1 billion per year, he added.

The concerned government official conceded that the country’s garments industry is suffering from acute problems of low productivity, poor quality, weak management and marketing skills’ and hence facing serious threat of losing its share in the international markets.

Keeping this in mind, the government is said to have decided to make exporters competitive in garment business so that they can be the catalysts to enhance the productivity of the garment industry by making it cost effective and thereby sustaining and improving its market share in the global market.

The main objective is to provide comprehensive consultancy services and technical guidance on all aspects of garment manufacturing and productivity enhancement methods in order to meet the challenges of global market.

Sources said the government was considering a proposal to hire foreign consultants from Hong Kong, China, Taiwan, Korea, Japan, Germany, Italy, UK, Turkey and Sri Lanka to help improve existing technology used in the garment industry.

Also, their relevant experience of working in their own countries in the garment industry with proven strength and highest level of production efficiencies will be the real advantage for learning by garment manufacturers.

The government, sources said, will ensure transfer of knowledge and expertise from foreign experts to local staff of the industry and to improve their capacity building by the professionals engaged for which a Project Implementation Cell will be established.

It has been proposed that in each factory, maximum three to four foreign experts of relevant areas such as dyeing, finishing, knitting, sewing, laundering, industrial engineering, printing, mechanical maintenance, designing and branding will be placed.

It has been proposed that the cumulative basic salaries bill for any recipient for its entire approved expatriate staff will not exceed $25,000 per month.

Garment manufacturing factories (preferably vertically integrated) from all over Pakistan will be part of the new programme. However, initially 10-12 factories will be selected from different garment clusters of the country. The basic selection criteria for any garment factory will be its export sales volume (in dollars). The export sales details of the last two consecutive financial years will be evaluated. All major garment export factories will be ranked according to their year-wise sales volumes.

Before the start of the programme implementation and engaging of foreign experts, National Productivity Organisation (NPO) will establish certain benchmarks for all relevant technical fields to be covered. The government will initially provide Rs300 million to carry out the job by the ministry of industries, production and special initiatives for technical upgrading of garment industry of Pakistan.

The benefits that the textile garment industry will get by the new initiative include improvement in the existing production practices according to the international standards resulting in the betterment of product quality, enhancement in productivity by learning best practices of foreign industry, update knowledge on latest technology, improvement in capacity and skills level, learning industrial engineering techniques for performing manufacturing operation efficiency in garment value chain, adoption of cost effective techniques to minimize wastage, development of on-job-training culture, optimal capacity utilisation of the garments units and introduce the concept of continuous improvement.

“Textile is the most important sector of the economy and, that is why, $4 billion investment has been made in modernisation and infrastructure development of the industry during the last 4 years,” a source said.

It imparts 46 per cent share in total manufacturing. It contributes about 66 per cent of total exports and 38 per cent of total employment. The textile industry’s share in GDP is about 30 per cent in value added production by the manufacturing sector.