DUTY ON HAND-KNOTTED CARPETS WAIVED
Pakistan to regain its share in US market
By AMANULLAH BASHAR
Mar 17 - 23, 2003
Pakistan hand-knotted carpet industry has made tremendous growth over the years and contributing significantly to the export earnings of the country. This cottage industry, using 100 per cent locally produced raw material, techniques, color and designs, has adapted itself wonderfully to the changing world market requirements.
Recently, as a policy to enhance accessibility to Pakistan products in the US market, the US House of Representatives has passed a trade bill that would eliminate duties on hand-knotted carpets which may give a boost to carpet exports from Pakistan. This incentive of duty reduction or elimination would last until 2005.
Pakistan would be the major beneficiary of the provision, which adds handmade rugs to the Generalized System of preferences program, which allows designated developing countries to sell their goods in the United States without paying import duty. Rugs from Turkey, Nepal, Egypt and Moscow would also qualify for the duty free treatment.
The approval cut in duty on Pakistan hand-knotted carpets by US authorities will help regaining the lost market share in the US market by at least 5 to 6 per cent.
US are the biggest market for Pakistan hand-knotted carpets followed by the European market. The proposed duty cut is around 2 to 2.5 per cent, which will reasonably reduce prices of Pakistani carpets in the US.
The circular for duty cut has reached Export Promotion Bureau. USA has reduced this duty on Pakistan proposal, which was submitted by Commerce Minister Abdul Razzak Dawood, one and a half-year ago. Pakistan must focus on US market to get maximum share. The carpet manufacturers are planning to organize a carpet exhibition in the US to further popularize new designs and color schemes. US have a market of over 60 per cent of the total carpets produced in Pakistan.
Pakistan exported hand-knotted carpets worth 90 million dollars during 2002 compared to 127 million dollars in the year 2001, showing a decline of 41 per cent.
It may be mentioned that as fallout of the events of September 11, the export of Pakistan carpets to US had declined by 37 million-dollar last year which was duly brought to the notice of the US officials by the Commerce Minister Razzak Dawood. Hopefully, the recent duty cut will not only help make up this fall but likely to enhance export of this value added item to the US market.
Pakistani carpet exporters have to undertake hectic marketing campaign in the US market, as American importers are not visiting Pakistan due to travel guide since September 11.
Indian exporters have taken over some of the Pakistan share in US carpet market since September 11, however, the incentive of duty cut would help regaining the lost share provided the exporters as well as the government bodies like Export Promotion Bureau played smartly to carve a better place for our products through aggressive and effective marketing campaigns in that choosy market.
Previously, Pakistan used to weave the "Sehna" knots which produce a particular kind of surface. However, now with the application of other knots like Ghiordes new designs of carpet are increasingly employed with Tajik, Turkmen, Uzbek and other oriental techniques lending their own special touch and mood. New experiments are also be made with warp and weft to make them more pliable.
As a result of application of new techniques, a great improvement has taken place in the quality of wool that is used in carpet weaving. In addition to the traditional varieties the Cholistan wool, Ghazni and other superior wool varieties known for their toughness and softness are also being used for making the new product.
Pakistan hand-knotted rugs are highly valued in the US and EU markets as they are a good investment, long lasting and are good value for money. Market value of these carpets appreciates with the passage of time. Old rugs made hundreds of year ago are considered priceless works of art and command fabulous prices in the international market.
While buying an antique carpet it is necessary to thoroughly check it for its age, brittleness, stains and moth damage. New, beautifully executed carpets are also a good hedge against inflation. With wages and wool prices going up and the purchasing power of the money under considerable pressure, rugs are bound to appreciate in value in coming years.
Return of the Afghan refugees to their home country is a recent setback to this industry, as these afghan craftsmen have their own style, designs and color scheme combination with Iran, and Central Asian cultures. Pakistan carpet industry had made a quantum jump with the addition of the Afghan carpet weavers. However, training centers and digital technology being used in this craftsmanship has greatly helped improving the quality of Pakistani carpets.
Located for the most part in the countryside, the Pakistan carpet industry is basically cottage in character and employees over a million weavers, dyers, washers, clippers and others associated with the trade. Carpet making helps fight unemployment and poverty in rural backwaters where few openings for gainful occupation are available. In many backward and underdeveloped regions it is the only source of livelihood for people. Many young people who cannot acquire education because of lack of resources become productive members of the society by learning the art of carpet making.