KARACHI, Oct 19: The Export Promotion Bureau (EPB) has drawn up a two-pronged strategy that seeks collaboration with the US investors and importers of textiles and is also planning cooperation with China to tackle the cut-throat competition in the American market after December 2004 when the textile export quota regime would be dismantled and a virtual price war like situation is to set in.

A large number of the US investors are said to have invested heavily in textile manufacturing in the neighbouring South American countries particularly in Mexico from where they import textile products in their home market. They are facing tough competition from China in those goods which have been taken out of quota regime in last few years.

For last few years, these groups of the US investors and importers of textiles and apparels have been aggressively lobbying against China accusing it of keeping yuan under-value by at least 40 per cent and giving huge subsidies to their textile manufacturers.

Now these groups of the US investors look towards Pakistan, Bangladesh and India to provide textile products in those categories at cheaper rates when they would not be bound to quota ceilings.

A director of J.C. Penny, one of the top stores chain in the US visited Pakistan in August and is said to have talked to a few of the leading textile manufacturers and exporters to consider a long-term supply arrangement.

"American stores like J.C. Penny end up with three to five year purchase agreements with their suppliers," Abid Javed Akbar, the Vice Chairman of the Export Promotion Bureau informed Dawn on Tuesday.

Abid disclosed that leaders of two other powerful US associations of textile and apparel importers are also in close contact with their potential suppliers in Pakistan. "These associations are in process of building bridges with All Pakistan Textile Mills Association and other textile bodies in Pakistan," he said

He indicated that one of these two associations is expected to sponsor a visit of more than 125 importers with brand names to Pakistan.

The Bureau vice-chairman does not perceive China as a competitor and threat to Pakistan in post-textile quota period but in fact is convinced that there is a lot of area where Pakistan and China can cooperate in textile for mutual benefit.

"We are seeking cooperation from China in manufacture and marketing of selected textile products," he said and pointed out that China was wrongly being perceived as a tough competitor to Pakistan in the US and other markets.

"Neither China aspires to dislodge Pakistan from the US market nor does it plan to go for aggressive marketing by offering lower prices," he asserted and pointed out that plans are under way to improve cooperation with China in fabrics, bed sheets and other areas.

He disclosed that the Chinese vice minister for textiles is expected to visit Pakistan when he visits India in next few weeks. The Bureau vice chairman said that he was in China during August and has asked the minister to visit Pakistan either before or after he visits India.

Meanwhile, according to business sources the textile buyers in European Union and the US have now become slow in placing their orders with Pakistan or with other countries. Market situation will be different on expiry of multi-fibre arrangement and then there is a global bumper cotton crop which has also eased somewhat the prices of textile products, market analysts say.

During the first quarter of this year the export planners are not happy with the export performance of certain textile categories which are not showing expected growth. The planners projected $55 million export for knitted fabrics. The proportionate target for first quarter was $20 million against which actual export has been found to be $19 million. The export of readymade garments in first quarter is worth $320 million are against proportionate target of $324 million.

The overall export of textiles during first quarter is worth $2.23 billion as against proportionate target of $2.19 billion. The planers estimate to net in almost $9 billion from textile export this fiscal year.