Livestock exports hamper value addition

At times when countries are earning billions by adding value to their produce, it seems the government of Pakistan is oblivious to the term value addition. Amongst many victims of the governments apathy is the leather industry of Pakistan. The leather industry can earn the national exchequer a handsome amount of foreign exchange, especially now that the prices of leather products have surged globally. Pakistan produces one of the finest qualities of leather and enjoys high demand from many western economies. The international prices of leather have experienced a surge owing to the surge in demand of leather products globally, but Pakistan has a minimal share in the global market of around 1 percent. Leather manufacturers are suffering big time because of the power shortages, smuggling of hides, and illegal export of wet blue (semi-processed form). According to former chairman, Pakistan Tanners Associaiton (PTA) Gulzar Firoz, the biggest concern of the PTA is the export of livestock from Pakistan to Iran and Afghanistan. Firoz asserts that with the connivance of customs officials; exporters routinely smuggle more animals than they are licensed to export. Gulzar also mentioned that the export of top quality livestock has pushed the prices of milk and meat to towering levels. He also claimed that the top quality hides of sacrificial animals of Eid are also priced exorbitantly, putting them out of the reach of local buyers. The export of live animals should be rationalized and only export of meat should be allowed which would not only be profitable for the leather manufacturers but also for packed food industry. Pakistans tanning industry contributes 6.32 percent of the countrys total export earnings and around 5 percent to the manufacturing GDP. According to industry sources, on average tanneries are utilizing 70 percent of their capacity, while their exports tally about $1 billion. Industry sources say if manufacturers work on full capacity they will see a 10 percent increase in exports. While industry sources contend they can generate export earnings of up to $5 billion within three years; it is difficult to fathom such returns given their current constraints.