KARACHI, March 17: India will be enjoying an advantage of over 15.58 per cent in duties over Pakistani textile exports to European markets in the quota-free era beginning from January 2005 , industry sources said on Wednesday.

"Once India accepts the European Union's offer of 30 per cent enhancement in textile and clothing quota levels, which is currently being discussed by its industry, Pakistani textile exports will suffer severe setback on paying hefty duties ranging between 12.4 and 25.5 per cent," they added.

The EU has recently offered to raise its 2004 textile and clothing quota levels by a hefty 30 per cent to India with some conditionalities. However, if the offer was accepted by India it will prove disastrous for Pakistani textile exports to EU member states.

Despite the fact that Pakistan is presently enjoying 12.4 per cent concession under the GSP (Generalized System of Preferences), but the same will be ending from January 1, 1005.

Against this, India that is enjoying a reduction of 2.48 per cent in duty under the EU's most favoured nation (MFN) status is paying 9.92 per cent and will continue to do so even thereafter.

This means all Pakistani textile exports will have to pay 2.48 per cent additional duty against Indian exports to EU states when concession of a 12.4 duty is withdrawn under the GSP from January 1, 2005. "But the most damaging factor, which is going to entirely cripple our bedlinen industry, will be the anti-dumping duty of 13.1 per cent recently imposed by the European Commission.

And it is feared that after the withdrawal of GSP concession bedlinen exports to EU member states during the quota-free regime will come to a standstill," the sources added.

The industry feels that no exporter will be able to compete with 25.5 per cent duties on bedlinen imports to EU member states. After the withdrawal of 12.4 per cent GSP concession and adding to it the 13.1 per cent anti-dumping duty the total impact of 25.5 per cent will be more than the industry could sustain.

Against this, the India textile exporters will be paying 9.92 per cent customs duty on getting 2.48 per cent concession for having the MFN status, but Pakistani textile exporters will have to pay a full duty of 12.4 per cent after the withdrawal of GSP concession.

Though the EU has offered India an additional 30pc market access in 2004, having a corresponding increase in the use of flexibilities, in return, New Delhi will need to bind its tariffs across-the-board in this sector at a maximum of 20pc.

The European Union in the year 2001 gave Pakistan 15pc extra market access on a binding of fixing customs duty at 20pc. However, India is being given higher market access of 30pc over the present quota levels.

It has perturbed the textile exporters that the EU has not given good deal to Pakistan that has been a front-line state in the fight against terrorism and also suffered huge financial losses in the Afghan war.

An exporter of readymade garments said whereas the Indian government was discussing the textile quota enhancement offer by the EU with its industry, the Pakistani government had never taken into confidence the exporters when taking any important decisions.

"We fail to understand government attitude towards the imposition of 13.1pc anti-dumping duty by the EC on bedlinen as there is a complete silence and no meeting or consultation is being made with the industry," another leading exporter said.