Aptma members' cool response to Uzbek investment offer

The proposal that experienced Pakistani textile entrepreneurs should consider setting up their operations in Uzbekistan has met with "cool response" here.
The proposal had come from Uzbekistan's First Deputy Minister of Light Industry Kim Tae Bong sometime back, who had indicated the government of Uzbekistan's desire to promote investment in the textile sector with the help of countries like Pakistan, which have achieved tremendous progress in this field.
A spokesman of All Pakistan Textile Mills Association (Aptma) told the Business Recorder here that to the best of his knowledge not even a single textile entrepreneur had shown interest in the offer.
"Unless an investment is guaranteed safety and security, the chances of attracting investment in the textile sector will be nil," he said.
The Commercial Secretary in the Embassy of Pakistan in Tashkent had said that Bong was told that highly regulated business environment in Uzbekistan was discouraging foreign investment and, therefore, it would be difficult for the Pakistani entrepreneurs to take risk.
Bong, however, enumerated a number of factors, which make investment in the export-oriented textile sectors a secure and profitable proposition.
He said that apart from low labour and utility costs, the government had offered raw cotton price discounted at 200 dollars per tonne, income tax exemption for five years and exemption from mandatory sale of 50 percent of hard currency earnings.
He also hinted at the possibility of the government helping to arrange through Japanese and Korean Exim banks as also working capital from local banks.
According to the Commercial Secretary, no doubt, the business and investment environment in Uzbekistan was very restrictive, especially the restrictions on convertibility of currency was a major concern for all the businesses operating in the country.
However, it was also true that it did not affect the export-oriented industries as their earnings were in hard currency, he said.
Moreover, the proposed textile ventures were also being offered concessions in the area of currency convertibility, he said, adding the Korean, Turkish, American and Egyptian companies had recently set up joint ventures to take advantage of these incentives.
The Commercial Secretary felt the offer would be considered seriously, adding in case it materialised, it would help increase Pakistan's profile in the area and subsequently lead to other commercial benefits.