Textile industry to get incentives

RECORDER REPORT

KARACHI: Pakistan has fixed an ambitious textile export target of $25 billion till 2014 in the five-year textile policy and the government is fully supporting the industry to achieve this target, said Dr Mirza Ikhtiar Baig, advisor to Prime Minister on Textile.

Addressing the inauguration ceremony of 9th Textile Asia 2012 Int'l Exhibition at Karachi Expo Centre on Saturday, Ikhtiar said the textile policy 2009-14 announced by the government of Pakistan also allows various incentives including concessional financing to encourage capital investment in value added textile sector.

The government of Pakistan has also withdrawn customs duty and sales tax on import of plant and machinery by the manufacturing industries, he added.

"Our textile industry has invested $ 6 billion under BMR during 1999 to 2003 and with the present hefty profits, textile sector continues to do the capital invest in this sector. While under the new development, Textile City project has been launched in Karachi with most modern facilities, besides Garment Cities in Karachi, Lahore and Faisalabad and an Industrial Park in Karachi," he added.

Pakistan is transforming itself from being a stagnant economy to fast-paced emergent economy as a result of the structural reforms introduced by the government in the areas of investment, business and trade in addition to covering social, political, judiciary and security, Baig said.

"The geographical location of Pakistan warrants unique proposition to make investments here. As Pakistan lies at crossroads to South Asia, Gulf and Central Asia, it gives direct market access to more than half the population of the world that lives here," he added. Talking about the incentives, he said that investors are enjoying full legal protection for their investment under which they can transfer 100 per cent dividends.  This is a proof that Pakistan has one of the most congenial business environments in the region.

The demand for textiles in the world is around $18 trillion, which is likely to be increased by 6.5 percent. China is the leading textile exporter of the world's total exports of $400 billion. Country-wise major market shares of the textile exporting countries are: China: $55 billion, Hong Kong: $38 billion, Korea: $35 billion, Taiwan: $16 billion, Indonesia and Pakistan: $14 billion, he said.

Though Pakistan has emerged as one of the major cotton textile product suppliers in the world with a share of world yarn trade about 30 percent and cotton fabric 8 percent, he added.

Ikhtiar said textile sector is the backbone of our economy having 56 percent of our total exports and 38 percent job creation in the manufacturing sector and holds great importance as it significantly contributes to our exports and foreign exchange earnings. Nearly all the world renowned brands are manufactured in Pakistan keeping high standard of international quality and competitiveness, he added.

Pakistan is the 4th largest producer of cotton yarn and cloth in the world and has signed MOU with Monsanto for BT cotton to improve the yield per acre. Pakistan ranks 2nd in export of yarn and 3rd in export of cloth and is 4th largest producer and consumer of raw cotton, Ikhtiar Baig said. "We have the highest production of cotton this year for more than 14 million bales and hoping that the production will reach 15 million bales in the next cotton crop season," he added.

In order to support our economy affected by devastated flood, the European Union has allowed duty-free export of 75 products from Pakistan out of which 65 are textile products. The facility is initially for 2 years, extendable for third year after, he mentioned.

He said Pakistan has also embarked on a wide-ranging initiative to increase its attractiveness to foreign investors in the textile sector.  Presently, the government has identified textile as a key priority area and is making all possible efforts to set the right policies and incentives that encourages private sector investment in value addition and expansion in a bid to gain wider access to the international markets.  On the occasion Dr Khursheed Nizam, CEO Ecommerce Gateway said last year, business worth 31 million dollars was negotiated in 'Textile Asia' and it would be further enhanced this year.  He said some 276 exhibitors from 39 countries representing 369 international brands are participating in Textile Asia 2012. In addition to a large number of textile sector representatives, 271 foreign delegates are attending the exhibition which is indeed an excellent opportunity to cater for the buyers and sellers, he added.