INTERVIEW WITH ATIQ A. KOCHRA, ZONAL CHAIRMAN SOUTH, PRGMEA
Nov 7 - 20, 2011
I have done my MBA from IBA, Karachi in 1987-88. Since 1988, I have been associated with the textile industry. I started my career from weaving, and over the years have been a manufacturer and exporter of readymade garments, and also operated as a buying agent for several international buyers, sourcing textiles for them from Pakistan. I have been associated with PRGMEA for last 10 years and served on the Zonal Managing Committee and the Central Managing Committee, and also was the Zonal Chairman in 2005. I am currently the Zonal Chairman, South at PRGMEA. I have served on several committees related to textile industry.
PAGE: TELL US SOMETHING ABOUT YOURSELF.
PAGE: YOUR VIEWS ABOUT PAKISTANI GARMENT SECTOR AND ON THE TRADE BETWEEN INDIA AND PAKISTAN.
ATIQ KOCHRA: Currently, most of the textile and garment trade between India and Pakistan is being done through third countries due to various trade barriers, especially the non-tariff barriers. If this trade is liberalized, Pakistani garment and textile exporters can gain a foothold into one of the fastest growing markets in the world. Pakistan can benefit significantly through trade with India, especially in the garment and textile exports, as the production cost of Pakistan's textile and garments products are lower than those of India. Besides, the products being manufactured in Pakistan are different from the ones being produced in India, automatically offering us a niche to operate in.
On the other hand, textile and garments consumers in Pakistan can benefit in terms of more choice from the products being offered by India. Overall, I do not see any detrimental effects if our trade with India is liberalized, rather we will benefit from it. The garment sector of Pakistan is the single largest exporting subsector of textiles. It accounts for over $4 billion in exports and constitutes approximately 35 per cent of the total textile exports of Pakistan. Most of the companies in this sector are SMEs. The garment sector has the potential to earn billions in export trade, as Pakistan's garment exports still account for less than one per cent of global garments trade despite being the 4th largest producer of cotton in the world. Being a highly labor-intensive industry, it has the potential to bring thousands of jobs to the unemployed youth, especially women, at a very small capital outlay. Notable garment articles being exported from Pakistan are denim jeans, trousers, t-shirts, night suits and tracksuits.
PAGE: DO YOU THINK SOUTH ASIA FREE TRADE AGREEMENT COULD HELP PAKISTANI GARMENT SECTOR PROSPER?
ATIQ KOCHRA: There will not be any significant effect on Pakistan's garment sector through the SAFTA agreement, as the import markets of the SAFTA member countries, with the exception of India, are very small, and countries like Bangladesh, Sri Lanka and India have their own well developed garment industry. However, in case of India, which is one of the BRIC's countries, and having a huge middle class, with increasing disposable incomes, if the duties are brought down to five per cent as per SAFTA agreement, our products will become even more competitive and attractive for the Indian masses. One indirect benefit could be realized from the SAFTA agreement, is that if the member states join hands and push our respective products to the world, jointly, we could increase our share of the world apparel market.
PAGE: INDIA HAS INDICATED THAT IT WOULD FINALLY REMOVE ITS OBJECTION TO THE EUROPEAN UNION'S PLAN TO GRANT PAKISTAN TRADE CONCESSIONS TO HELP IT RECOVER FROM THE 2010 FLOODS. HOW COULD PAKISTANI GARMENT SECTOR BENEFIT FROM IT?
ATIQ KOCHRA: Pakistan is set to gain a lot if India removes its objections over the EU trade concessions issue. The 75 tariff lines, which are being offered by the EU, give us additional benefits to the tune of about Euro 100 million per annum. There are 13 garment products in the list of 75 products and the benefit we will get would be an increase of about Euro 30 million per annum in garment exports to EU. However, the main benefit would be that these concessions will ultimately lead to granting of GSP, which Pakistan is hoping to get in 2014.
PAGE: PAKISTAN HAS YET TO GRANT MFN STATUS TO INDIA TO BRING IT ON PAR WITH OTHER TRADING PARTNERS. INDIA, ON THE OTHER HAND, HAS YET TO REDUCE NON-TARIFF BARRIERS SUCH AS VISA RESTRICTIONS, SECURITY CLEARANCES, AND STRINGENT CERTIFICATION RULES. YOUR COMMENTS.
ATIQ KOCHRA: Under the WTO agreements, we are bound to give MFN status to India. If we do not do so, India can take us to arbitrations court of the WTO at any time. Besides, if India has non-tariff barriers, so do we. Indian goods and businesspersons destined for Pakistan have to face the same visa restrictions, security clearances and stringent certification rules, etc. which our businesses and products face in India. Unfortunately, our foreign policy and trade policy are mixed up, and we have politicized this issue, and given preference to the foreign policy over trade. As described above, if we want to diversify our exports into India, we have to grant MFN to them.
PAGE: GIVE YOUR VIEWS ON EFFORTS OF THE GOVERNMENT FOR THE PROMOTION OF PAK-INDIA TRADE.
ATIQ KOCHRA: We should appreciate the efforts of the government of Pakistan for the promotion of Pak-India trade. The President and Prime Minister have always put special emphasis on it and have put it on top of their agenda items during talks with Indian counterparts. Our ministry of commerce and the ministry foreign affairs have been working on this issue for a long time now and through their efforts, this monumental step is close to reality. We would request our government not to let this issue become politicized and take a principle stand on it, as we are hearing that the government has decided to put on hold the issue of granting MFN to India after receiving hostile reaction from opposition political parties and security agencies.