Status and Strategy to Revamp Textile Industry of Pakistan

In recent past and especially after the suspension of Article 370 and bifurcation of India-held Jammu and Kashmir in August 2019, the most negatively affected area between the two countries was trade, other things apart. Frequent trade between the any two country is more related to public needs/ benefits than to whims and sentiments and its suspension put people in untold misery and distress. Normal trade is a gate pass to further peace and development which not only deter countries to avoid war but also encourages them to ignore or overlook many of the irritants they face in their day- today working. And thus, it’s a straight way to individual progress and happiness, which every genuine government wants to provide the people over whom it rules. Neither India nor Pakistan is exception to this universal tradition in democratic form of government.

Status of textile industry in Pakistan

Since partition textile industry of Pakistan has remained a backbone to country’s economy as till date it contributes 8.5% to its Gross Domestic Product (GDP), making 8th largest exporter of textile in Asia. This sector is more important for the nation because it employs about 45% of labour force of which 38% are directly engaged in manufacturing works. This industry Has made the nation the 4th largest producer of cotton having 3rd big spinning capacity in Asia after China and India. Pakistan’s position in textile industry is a matter of envy for many other countries of the region as it increased from 3 at the time of independence to 600 in the year 2000. In the present there are more than 423 textile industries working in the country which owned a fair command in supply for all mane-made and natural yarns and fabrics. Initially the abundance of raw materials for this industry in the country remained a main source of inspiration apart from other factors that make it an essential for the life of the nation.

This chief industry of Pakistan is in distress today. It has registered a significant decrease in production and marketing facilities In the year 2014-2015 it was of $11.625 billion but next year (2015-2016), it dropped to $10.395 billion. Although the main cause of its downfall was due to rising cost of production, energy crisis, research and development along with tough competition from other regional powers like Bangladesh, India and Vietnam. As a result of these factors country’s share in the global textile has fallen down from 2.25 to 1.7% while in the same period the share of Bangladesh increased 1.9% to 3.3% and India from 3.4 % to 4.7%. These show a dismal fate of textile industry in Pakistan.

Solutions ahead

In the Circumstances, trade deadlock with India on account of suspension of Article 370 and its after effects are affecting the textile industry more than anything else. Apart from other natural and man-made errors, the textile industry as a whole is bound to import cottons from faraway countries which prove an expensive affair for the industry and the consignments also take months to reach the Pakistani shores for use. Its best solution lies in the neighbourhood country, India, which can provide Pakistan raw cotton price at an affordable rate. India is the largest cotton producer in the world and for Pakistan its transportation cost will also be minimal because it’s a bordering state and shipments are available at next door. Keeping in view all the above factors and textile industry’s export revenue which comprise 57%, The Pakistan Textile Exporters Association has requested the government to take remedial measures to make the industry safe, retain its pace of development. In addition, as the industry is heavily taxed by the government, the Pakistan Textile Mills Association has recently demanded to remove the duty on cotton imports and a rebate of 5% on textile exports. These requests of Pakistani Associations have come at a time when 110 textile/cotton mills have been shut down due to various barriers which bear national, regional and global factors. Even the performance of other segments of Pak economy is not very satisfying as the nation is struggling high rate of inflation, rise in prices of electricity, gas, and other staple food items which resulted in the sacking of country’s finance minister and no respite appears in sight.

Steps required

At the juncture, many people and partially, the government as well, feel that normalisation of trade relations with India will improve the prevailing ills to a large extent. To this end Pakistan is also trying to engage with India hoping imports of sugar and cotton and India also appears to respond favourably to normalize the trade relations between the two countries. However, to work out on total normalization of trade, transportation linkages, railways and road connections and limited shipment facilities along with government restrictions should be kept in mind. Apart from border there are many such factors that have push the trade between the two at the lowest of less than 1%. Slowing down of trade with India has affected most who belong to the category of low-paid workers, such as small time-traders, labourers, drivers, and porters. In fact, they are of marginal communities, who earn their bread on daily basis. They also feel and think of the tussle as futile and useless. No doubt, there are some in India who consider that it is impossible for India to do normal business with Pakistan due to reasons more than one. In the situation dilemma on both sides persist who should come forward first?

Since division of the sub-continent, drifting reasons apart, it’s a sorry state of affairs between these two nations that they are not mutually dependent in a meaningful way and there has been a limited scope not only for trade but for other sectors too. Generally, this situation aggravates escalating matters and finally peace between them becomes easy prey. Not only for Pakistani government but for other regimes too who believe in mass welfare and their happiness should hear and see the miseries of the people to whom a democratic system is responsible and authorized to act accordingly.

 

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