SHABBIR H. KAZMI
Mar 12 - 25, 2001
Abid Farooq was recently elected Chairman of All
Pakistan Textile Mills Association (APTMA). He has been very active
member of APTMA since 1994 and belongs to the new breed of young and
dynamic textile entrepreneurs of Pakistan. Before being elected
Chairman APTMA Abid Farooq was Chairman APTMA, Punjab Zone and Vice
Chairman APTMA for two consecutive years. Abid Farooq is the Chief
Executive of Ali Akber Spinning Mills located at Lahore. The Company
is listed at Karachi Stock Exchange. He is an MBA from Claremont
Graduate University, USA. He is 44 years old and has four children.
PAGE: What is the role of textile industry
in economic revival of the country?
ABID FAROOQ: Textile industry is the largest
organized industry and earns more than 60 per cent of total export
proceeds for Pakistan. No efforts should be made to undermine its
role. Rather efforts should be made to enhance its contribution as it
has the largest infrastructure. Textile industry is playing its due
role and has invested over US$ 500 million to expand and revamp its
operations. The seriousness of sponsors is evident as the companies
have largely used their own resources — retained earnings. The fresh
investment has been made to achieve greater value-addition and to
improve unit price realization. While the industry is making efforts
to make the best possible use of each gram of cotton produced in the
country, it also seeks help of the GoP. It does not demand protection
but certainly deserves level playing field.
PAGE: There was a sort of confrontation
among various sub-sectors, what efforts are being made to resolve the
ABID: It may be true that various
sub-sectors were facing a head-on collision situation in the past.
However, the situation was more an outcome of efforts to attain
political mileage. No one should forget that each sub-group has a due
role to play and Pakistan cannot optimize the benefit of silver fibre
unless each group gets its due share. Farmers need a decent price of
cotton, spinners want cotton at competitive price in required quantity
and made-ups manufacturers can only compete if quality of fabrics is
of international standard. APTMA's demand is 'price of cotton must
commensurate with quality'. The industry also demands its first right
on locally produced cotton. Why should we allow our competitors to get
the benefit whenever the country has a bumper cotton crop?
PAGE: How does the textile industry plan to
implement Textile Vision 2005?
ABID: A new Focus Group has been formed to
suggest measures to implement Textile Vision 2005. It is using the
available database. The industry is striving hard to get ready to meet
the challenges to be faced after quota regime is completely phased out
on December 31, 2004. It is evident from an investment of over US$ 500
million by the textile industry. This time, bulk of this investment
has been made from internal resources and there was less reliance on
PAGE: What is the outlook of textile
ABID: The year ending on September 30, 2000
was very good. Most of the listed companies are declaring
substantially higher dividend. Even those units which were perennial
loss making entities were able to curtail their accumulated losses.
The investment which has been made lately should have been made much
earlier and should continue as a normal feature. The sponsors of most
of these companies have forward looking vision and have been investing
even during the worst period.
PAGE: Despite such a mega investment, it is
feared that the industry faces confusion?
ABID: I will be honest and not minced my
words. Textile industry has committed certain mistakes in the past and
the result is, even if it asks for legitimate covers, its demand is
not received by the policy planners in true perspective. For example
when we say that industry suffers due to lack of long-term policy,
high electricity and interest charges, our woes are not given due
attention. Similarly, when we demand for buffer stock of cotton it is
not understood properly. The data shows that often the surplus is
marginal and it is the right of local industry to get the benefit. The
other problem is that due to a marginal gap in demand and supply of
cotton, its prices remain highly volatile. Our demand is that when
spinners are asked to pay international prices of cotton, the
electricity tariff and interest should also be comparable with
international rates. If the electricity tariff and interest rates
cannot be lowered the local industry must be compensated in some other
ways. Our only demand is availability of cotton at affordable prices.
Unless we are able to rationalize yarn cost, our made-ups cannot
compete in the global markets.