Pakistan's textile industry should improve its own development capabilities

by:JIYALI     2021-08-17
The Pakistan Polyester Fiber Group recently stated that compared with its competitors, the 6.5% import tariff only reduced the pressure on Pakistan’s expanding business costs. The group pointed out that Pakistan’s business expenses continue to expand due to the following reasons: outdated infrastructure, leading to increased transportation costs, high port fees for liquid chemical products, unstable power supply, unsound sales channels for engineering goods, high labor costs, and low productivity. The upstream chemical industry is underdeveloped and must import chemical products, which incurs high costs, increased freight, multiple taxes, and relatively high loan costs.   In this region, the PSF price range in Pakistan is close to the low end. In 2007, the average domestic PSF price was 95.6 rupees per kilogram, compared with 92.3 rupees per kilogram in India and 90.4 rupees per kilogram in China. In fact, the PSF industries in these countries are protected by the same import tariffs. There is no zero tariff in any country. Pakistan’s exports are actually zero tariffs. Throughout the entire production chain, domestic downstream textile companies enjoy exemptions from tariffs and tax regulations (DTRE) for the purchase of raw materials for export products. As PSF users get such a convenient policy, exporters can enjoy zero tariffs on imported raw materials.   Pakistan's man-made fiber consumption is lower than that of developed countries, but it is very close to other developing countries. The reason for the low consumption of man-made fibers in Pakistan is the low consumption of domestic industrial textiles and non-textile applications (such as the automotive industry, civil textiles, etc.), the downstream textile industry lacks sales channels and technology, and downstream textile companies lack machines to produce high-end products. Pakistan’s textile industry is a low-end product industry. In the past, the domestic PSF industry produced many special PSF products, but the downstream textile industry did not have appropriate equipment to produce and sell professional products. Per capita PSF consumption in Pakistan is 3.12 kg, compared to 0.64 kg in India.   The group said that the domestic textile industry must recognize this fact. They need to solve many practical problems in order to improve the situation of the textile industry. They should not rely on the government to help them get out of trouble every year.
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