Visiting an apparel factory outside Lahore on Wednesday, US Ambassador Wendy Chamberlin urged American companies and consumers to buy Pakistani products, declaring Pakistan "open for business".

She made her comments following a tour of Highnoon Textiles Ltd, a company hit hard by a sharp drop in orders from US buyers since the terrorist attatcks in the US and the start of military action in neighbouring Afghanistan.

"Pakistan is open for business. It is a reliable partner. That is my message to American textile buyers,'' Chamberlin told reporters following the visit to the factory, whose customers include Levi, Chaps Ralph Lauren, Calvin Klein, Eddie Bauer and Gap.

"The patriotic thing to do if you're American is to buy Pakistani products because the stronger the partner we have here in Pakistan is a stronger partner against terrorism in Afghanistan."

Babar Agha, chief executive officer of Highnoon, told the ambassador that his company has lost nearly 70 per cent of orders for January and 90 per cent for February 2002, forcing the layoff of 480 workers in October and November, with another 250 lay-offs expected in December.

"The social fallout of these decisions will be horrendous,'' Agha said. "If the US customers do not return for the fall season beginning in March, the consequences for the entire industry will be catastrophic.''

Both Agha and Ambassador Chamberlin agreed that there is no reason for American buyers not to do business with Pakistan. "US companies should not be afraid of doing business in Pakistan,'' he said. "The industrial and commercial activities are proceeding normally without disruptions."

Nevertheless, Highnoon and other Pakistani textile manufacturers continue to experience the effects of the dramatic drop in orders since the terrorist attacks in New York and Washington September 11.

A survey of 40 companies in Lahore, Karachi and Faisalabad showed a 68 per cent decline in orders for clothing that would be manufactured during a three-month period beginning in December. The companies reported that in recent weeks they have laid off 16,091 workers, or 36 per cent of their workforce.

Agha urged the United States to suspend tariffs on Pakistani exports, saying it will benefit US consumers and save thousands of jobs in Pakistan. The US is Pakistan's largest customer, importing $2.2 billion worth of goods last year.

Clothing and textiles account for $1.9bn or 86 per cent of the total. Pakistan has only a 1.6 per cent share of the US market for apparel imports, putting it behind 19 other countries. Its share of the US market for all textiles - apparel and non-apparel - is 2.65 per cent, behind 14 other countries.

The Pakistani Textile & Apparel Group, which helped arrange the factory tour, is a coalition of Pakistani textile and clothing manufacturers and buyers for US firms that import goods from Pakistan.