Pakistan garment makers get back to business
The assassination of the Pakistani opposition leader Benazir Bhutto at the end of last month provoked outrage across the country. Textile and garment makers got caught up in the crossfire, with forced power cuts shuttering firms for five hours each day. Here, Ahmed Abdullah reports on the aftermath of the attacks.
Violence erupted across Pakistan following the assassination of former Prime Minister Benazir Bhutto on 27 December, disrupting industrial activities in the country in general and Karachi in particular.
The hostilities spilled over into the textile and clothing sector, with at least eight garment factory workers being burnt to death and a number of others injured.
Around two dozen garment factories and five textile mills, 2500 bales of cotton, and many other small textile and garment units in the Kotri and Karachi industrial areas were set ablaze during the unrest - causing estimated losses of US$9m in textile machinery and equipment.
The country has also faced a serious energy crisis after a blast at a main electricity transmission tower on 30 December disrupted power supplies to the city of Karachi, and transport problems led to fuel shortages at upcountry power plants - creating a 4000 megawatt shortfall in electricity.
The whole of Karachi city remained completely shut for three-days between 28 and 30 December for a period of national mourning announced by President Pervez Musharraf.
And export shipments were held up due to the closure of banks and customs offices. It is estimated that textile and garment exports worth around US$95m were delayed during the shutdown.
Tanvir Ahmad Sheikh, president of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), said that during the unrest, losses amounted to 8% of gross domestic product (GDP)
Pakistan's textile and garment exports have been hit particularly hard, registering a decline of 25% during December compared with the same month of the previous year.
During the first half of the current fiscal year, from July to December 2007, textile and garment exports have remained static at US$5.3bn. And the trade deficit has reached $8.2bn during the period.
The country is hoping to meet a textile and garment export target of US$12.2bn for its current fiscal year, but this now looks unlikely as export growth remained sluggish so far.
In a press statement issued earlier this month, Syed Hassan Masood Zaidi, the vice chairman of the Pakistan Hosiery Manufacturers Association (PHMA), said the knitwear industry had been crippled by the power shutdown and gas supply cut-off.
Sheikh Mukhtar Ahmed, chairman of the Faisalabad Garment city, told just-style that the unrest was mostly confined to the southern part of the country.
The northern part, especially Punjab, which has a major share in exports, was only partially affected during the unrest but the overall situation remained peaceful he said, adding that the industry is now running at full capacity again.
Mr Sheikh noted that although the industry in Pakistan is currently facing power cuts and high prices of gas and other utilities, it has backups and still pays higher wages to workers compared with some of its competitors.
He also stressed that Pakistan is a peaceful country, and has the capacity to supply garments at cheaper rates than China, India and Bangladesh.
Talking about the latest industry orders he said that although huge orders are being handled, stable government policies are required to fulfil the customers' demands.
Sources in Karachi told just-style that the stricken garment factories have resumed their operations.
Italian garment manufacturing company, Maxco Pvt Limited, which was gutted by rioters where eight workers were burnt to death, has partially re-started it operations.
Prime Minister Mohammad Mian Soomro has pledged help from the State Bank of Pakistan and the Securities and Exchange Commission of Pakistan to help companies rebuild their enterprises.
He said the estimated loss to public and private property was around INR187bn and the government is working to finalise the method of compensation payment after final assessment of the damages and losses.
On the issue of power, the Prime Minister said a fixed schedule of power cuts would be observed during the shortage.
Pakistani textile mills had been asked to close their operations for five hours a day in an attempt to save electricity - but supplies of electricity to the industry and domestic consumers are due to be back to normal by the end of January.
The assassination of the Pakistani opposition leader Benazir Bhutto at the end of last month provoked outrage across the country. Textile and garment makers got caught up in the crossfire, with forced...
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