KARACHI, May 8: The Pakistan Leather Garments Manufacturers and Exporters Association (Plgmea) has contradicted the official export figures of leather garments and said that these figures did not reflect the actual exports which are far less than being projected.

The export of leather garments during July-March 2005-06 were $387 million as compared to $244 million during the same period last year, showing a huge increase of 57 per cent.

Fawad Ijaz Khan, adviser to Plgmea, in a press statement on Monday said that these export figures did not reflect the actual export of leather garments. He pointed out that as per figures compiled by the Federal Bureau of Statistics (FBS) exports had been registering a continuous increase since September 2005.

He said that there were three reasons behind this abnormal increase in exports of leather garments — shipments on paper, over-invoicing and wrong entry in PRAL data.

Mr Fawad said that a huge volume of leather garments was going to the UAE, South Africa, Iran, and Saudi Arabia. The exports to the UAE were $60 million during July-Dec 2005 as against $7m during corresponding period of the preceding year.

During the same period, he said that exports to Iran were $20 million as compared to $0.3 million earlier. Similarly exports to Saudi Arabia were $10 million as compared to $2 million during the preceding year. The exports to South Africa were $21 million during this period as compared to $8 million during last year.

However, exports to the conventional markets of leather garments, including USA, UK, Germany, France, Greece, Canada, etc. have registered a slight decline during this period of July-Dec 2005 over last year.

He said that the actual exports of leather garments to the UAE during July-December 2005 could not be more than $5 million; and to Saudi Arabia not more than $2 million. Exports of leather garments to Iran would be negligible. Therefore, he said, exports to these countries were either on paper or there was massive over-invoicing in exports.

Fawad Ijaz Khan urged the Collector of Customs (exports) to be more vigilant in clearing shipments of leather garments especially to the UAE, Saudi Arabia, Iran and South Africa.

The other reason of abnormal increase in export of leather garments, he said, could be wrong data entry by Pakistan Revenue Automation Ltd (PRAL) at customs stage. Plgmea is already in contact with PRAL to find out if there is any other item of exports entered in export figures for leather garments.

He said that a detailed survey of all leather garment exporters was conducted by Plgmea and export figures from July to Dec 2005 were collected from members of Plgmea.

The exports made by 80 exporters were worth $116m whereas according to FBS figures exports of leather garments were $269m during July-Dec 2005. Mr Fawad said that these 80 exporters constitute nearly 75 per cent of the total leather garment exports. This means that around $120 million export is either over-invoiced, fake or wrongly entered in PRAL data.

He urged the government to form an independent committee to check the authenticity of total exports of leather garments and of entire exports. The total exports during July-March 2006 were $12 billion which showed an increase of 18.56 per cent over the corresponding period of last year.