Cotton yarn is the leading exportable item from
By AMANULLAH BASHAR
July 23 - 29 , 2001
Pakistan's textile sector is poised to expand its
exports to the huge market of Far Eastern countries especially in
China and Korea.
The Chinese delegation, led by Chinese Prime
Minister, who recently visited Pakistan, has offered to lift the
entire production of ten textile mills. The purchase delegation from
China is likely to visit Pakistan shortly has rolled out the ball into
All Pakistan Textile Mills Association's (APTMA) court to select the
textile mills for lifting the entire production of those units.
Mushtaq Ahmed Vohra, Chairman, APTMA (Sindh and
Balochistan Zone) while talking to PAGE said that China offers
a big market for our textile products, however they have shown
interest in buying raw or semi finished textile products from Pakistan
with an objective to re-export them after value addition. The European
Union countries are doing it. When asked about the pace of progress
towards value addition in Pakistan, he said that the actual potential
of the textile sector has not been fully exploited in Pakistan.
Although the textile sector is already playing a leading role in the
exports sector by contributing over 65 per cent of the total exports
yet this sector has the capacity even to easily cross the mark of $15
billion or more provided the government duly facilitates the sector.
Regarding increase in exports to China, he said
that there was a significant move on the part of some Indian yarn
exporters to China. They have offered Pakistan to export yarn of 30
counts and below and India would export yarn of above 30 counts. This
mutual understanding would help eliminating the element of harsh
competition between the two countries to gain the export market. If
the two sides agreed to operate within the stipulated framework of
yarn counts, both of them can benefit and fetch good prices of their
yarn in the international market in general and from China in
Citing the example of hardships the textile sector
is facing, he said that the government has recently withdrawn the
export re-financing facility. This step has been taken at a time when
the sector is already confronted with acute financial crunch due to
non-payment of refunds and duty drawbacks running in billions.
Can any sector engaged with export glorify the
business in the face of financial constraints as the candle is burning
from both ends for them? At one end re-finance facility is withdrawn
while their genuine claims for refunds were falling on the deaf ears
for more than one year, he pointed out. He urged the government for
restoration of export re-finance facility at the earliest to enable
this prime sector to play its due role in strengthening the economy.
He also said that unless a smooth and problem free system for refunds
and duty drawbacks is brought into practice, this sector will be
unable to produce the desired results. He said that as a result of
stuck-up refunds for over a year, a number of units have gone out of
production. Replying to a question he said that it is not the question
of shortage of liquidity with the government, the will of the
government machinery for compliance to the good decisions is also
equally important to deliver the goods, he remarked.
On the question of quota restrictions, he was of
the view that it's a sort of protection for some while it's a barrier
for others. The abolition of quota would help those who produce and
export quality products while those who take it as protection may not
be able to compete unless they upgrade the quality of their products,
The government however has already taken notice of
the situation regarding delayed refunds and payments of duty
drawbacks. Federal Commerce Minister Abdul Razak Dawood has said that
immediate priority of this ministry to decide all refund cases, settle
duty draw back issue and facilitate access of the exporters to
potential markets. Regarding withdrawal of the export refinance
scheme, he however has said that days of cheaper refinance have gone
and other facilities are coming up which should be used by the genuine
exporters with due care and diligence. Razak Dawood however said that
export of the value added items which was 35 per cent of the total
exports in 1995 has reached to the level of 52 per cent of the total
exports i.e. $9.1 billion this year. The minister has expressed the
hope that the private sector has the potential to excel and hit the
export target of $10.1 billion set for the current fiscal.
Meanwhile Korea, another giant of the Asian
economies has announced to withdraw anti-dumping investigations on the
imports of the combed yarn originating from Pakistan and other
countries in the region.
The Korean Trade Commission has decided to
terminate the investigation because the applicant of the Spinners and
Weavers Association of Korea had withdrawn its application for the
anti-dumping investigations on the imports of yarn from Pakistan and
The exporters have expressed hopes that the
termination of investigation for anti-dumping duty would help to
increase the exports for South Korea.
Last year Pakistan exported 130.817 million dollars
of yarn compared to 109.97 million dollars business in 1999-2000.
Cotton yarn is the leading exportable item from Pakistan for several
years and its exports has exceeded to over one billion dollars from