Pakistan’s textile and clothing industry is stepping up calls for greater access for its products to the US and EU markets to help boost economic recovery and employment after floods devastated the country.
Industry executives, who were already under pressure from falling global demand, power shortages and instability brought on by a Taliban insurgency before the flood hit, also claim the measures would help improve security in the country.
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The textile makers are calling for help to make up losses after an estimated 3m bales (500m kg) of cotton was damaged by the flood waters, leading to supply shortages and moves by buyers to try to divert their orders to other countries.
Earlier this week Ejaz Khokhar, chief coordinator and former chairman of the Pakistan Readymade Garment Manufacturers and Exporters Association (PRGMEA), told just-style that Pakistan’s economic conditions have fallen to the level of Least Developed Country (LDC).
He also called on the government to pursue GSP+ status in the EU market and special market access into the US. This, he said, would help generate employment and improve economic conditions for those people affected by the flood.
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The textiles sector is the mainstay of Pakistan’s economy, generating exports worth US$10.244bn in the year from July 2009 to June 2010. Around $6bn of this went to the US and EU. The industry also provides jobs for around 2.5m workers.
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By GlobalDataPakistan is a key ally in the war on terrorism and the US last year debated a number of measures to strengthen Pakistan’s economy over the next five years and reduce terrorism in the region.
Key among its proposals for the apparel and textile sector are plans to set up reconstruction opportunity zones (ROZs) on the Pakistan-Afghanistan border to produce products that would enter the United States duty-free. But the legislation, passed by the House of Representatives in June 2009, remains blocked in the US Senate.
US duties on products like cotton trousers and shorts and cotton knit tops – which are among Pakistan’s main exports – currently average around 17%.
In the EU, meanwhile, textile products such as bed linen and towels face a 12% tariff. But Pakistan believes it should benefit from concessions like the GSP+ which was awarded to Sri Lanka in the aftermath of the tsunami to facilitate speedy recovery.
