Pakistan industry protests against costs and cuts

PAKISTAN: Industry protests against costs, cuts and taxes

By Ahmed Abdullah | 16 November 2010

Demonstrations have taken place held in Pakistan's major industrial cities to protest against yarn shortages, the 15% reformed general sales tax (RGST) or value-added tax (VAT), and gas cuts for the textile and leather industries.

Plant owners took part in rallies calling on the government to ensure a smooth supply of raw materials and energy for the export-oriented sectors.

Salamat Ali, chairman of the Pakistan Hosiery Manufacturers and Exporters Association, said foreign buyers are shifting their garment orders to Bangladesh and China. He urged the government to impose a complete ban on yarn exports.

And Mudassar Masood, vice-chairman of the Pakistan Leather Garments Manufacturers and Exporters Association (PLGMEA), said gas cuts and raw material shortages are hitting the competitiveness of the leather industry.

If gas cuts continue, the country's exports might drop by 30% claims Farrukh Saleem, chairman of the Pakistan Footwear Manufacturer Association.

Hundreds of textile plants remained closed in Faisalabad on Monday (15 November) for the two-day weekly gas cuts imposed under the government's gas load management program. Export shipments were halted.

Ajmal Farooq, chairman of the All-Pakistan Textile Processing Mills Association, said the closure of the industry in Faisalabad amounts to a loss of PKR4b (US$47m) per day.