Tariff restrictions have considerably been phased out in the past decade under various trade accords by reducing tariff rates. Non-tariff barriers in the form of quality, environmental and social standards are phasing in. Environmental issues have a big potential to become instruments of protectionism.

Complaints relating to environmental concerns against Pakistan, India and Malaysia led to the US embargo on import of shrimps from these countries and badly affected their shrimp export. Similar disputes over tuna and turtles etc. were reported from other countries.

The environmental concerns are here to stay and will be a major factor to be reckoned with in trade-related issues. Therefore, it is in the fitness of things to suggest that the developing countries like Pakistan need not shy away from them, since they serve their own interests.

Major exports of Pakistan are of textile and leather sectors and are concentrated in the USA and EU. This aspect has serious implications for Pakistani exporters in view of environmental and social compliance standards observed in these countries. The environmental issues have strong potential for becoming non-tariff barriers to our trade in textile and leather sectors. The concentration of exports in few countries keeping in view their strict environmental standards enhances our vulnerability in case we do not respond to the challenge in a appropriate way..

So the need of the hour is that our industry prepares itself in line with different environmental standards and provisions relating to the WTO agreements. We also need to explore other countries for our imports as concentration of imports in few countries renders us more vulnerable to voluntary standards of the West.

Pakistan’s textile industry is mostly concentrated in Faisalabad, Lahore, Gujranwala and Karachi regions. Textile processing units use chemicals like detergents, dyes, sodas, salts, acids and enzymes. The textile mills discharge the waste water into the municipal drains and rivers without any treatment having serious impacts on natural water bodies and land in the surrounding areas. Other environmental impacts include solid wastes, air emissions, noise pollution within the firms and health risks to workers from over-exposure to chemicals.

During the past few years, awareness of environmental concerns has increased among textile units, mainly due to pressure from the importers. Some of the units have taken various environmental initiatives in response to this pressure. These initiatives include machinery upgrades, water and energy conservation and recycling of chemicals. However, this does not bring down effluents and emissions to desirable levels and textile units need to supplement these efforts with high cost investments in measures like water treatment plants. The textile mills need to exercise both in-plant and end-of-pipe treatment options to reduce effluent loads and emissions to the prescribed levels.

Another important sector from environmental perspective is the leather sector. The major tannery clusters are located in Kasur, Sialkot and Karachi. Each cluster comprises of 100-200 tanneries. Chemicals are abundantly used at every stage of the tanning process. The lack of proper disposal of the effluents makes the leather industry the highest-ranking polluter in the country. The main chemicals used in the various processing stages include dyes, pigments, chromium, ammonium sulphate, lime powder, sulphuric acid, sodium sulfide and anti-fungus agents. Two projects, namely Cleaner

Production in Sailkot and Kasur tannery pollution control project (KTPCP) are success stories in bringing down the pollution level.

A considerable awareness is noticeable among the developing world as far as environmental issues are concerned. However, they need to act much more vigorously in view of rising trend of voluntary standards of the West. These standards reflect a combination of consumer sovereignty and social pressure, which the exporting countries cannot afford to ignore. It has been proved through different empirical studies that exporting firms reap economic benefits by complying with such standards.

The WTO agreements on technical barriers to trade (TBT) and on the application of sanitary and phyto-sanitary measures (SPS), to which Pakistan is also a signatory present both, an opportunity and a threat. Both agreements seek to increase market access for the exports of its member countries. The agreements, however, require that the importing countries formulate standards on the principles of transparency, fairness and science.

The developing countries like Pakistan are found wanting in two areas. First, they lack the institutional and technical capacity to test for and certify compliance with such standards and have to rely on costly foreign testing bodies. Second, they lack the resources to participate meaningfully in the development of these standards both at the level of standard-setting in international bodies and in responding to proposed national level standards in the countries to which they export.

The daunting challenge for the developing countries is to integrate trade and environmental policies harmoniously in such a way that maximum synergies are achieved. The ideal paradigm is one where trade policies become environmentally sensitive and environmental policies are not trade-restrictive.

The developing countries need to be encouraged and assisted in every possible way to take advantage of emerging green markets. It is also imperative that the developing countries take full advantage of the capacity building opportunities offered under different agreements of WTO.