Going downhill: Textile exports drop, PTEA chief alarmed

FAISALABAD:

One of the biggest hindrances in the way of economic progress is the festering energy crisis.

Textile exports witnessed a month-on-month drop of 7.89% in July alone as the Pakistan Textile Exporters Association (PTEA) lamented the situation.

Sheikh Ilyas Mahmood, the PTEA chairman, has said export numbers in the coming months might get even uglier as the textile industry in Punjab has remained deprived of fuel.

Textile exports recorded a 2.37% decline in July over the same month of the previous fiscal year. Power crisis was the major reason for the decline in exports as 50% of the industry’s production capacity took a hit due to the lack of energy supply.

The government, despite its promises, has remained unable to fight the crisis, the association criticised.

Policymakers do not seem serious in resolving the gas supply issue of the industry. Instead, the available gas is being supplied to unproductive sectors, causing a loss of foreign exchange, they argued. Situation is becoming unbearable for the industry as constant inefficiency is plaguing the viability of production units.

“Even the GSP Plus facility has not been able to generate desired results and efforts have frittered away as we are unable to produce export surplus due to massive energy constraints,” they said.

“The non-availability of energy, high interest rate and stuck up liquidity on drawbacks and refunds have played a major role in pulling down the growth and exports of the country’s textile industry,” said the PTEA chairman.

The issues have been brought up at various forums by the PTEA but the authorities do not understand the gravity of the situation and have not taken any steps to pacify the situation, added the official.

The chairman criticised the policies, which have failed to encourage investment in the textile sector during the last five years while competitors made huge investments due to the positive and business friendly environment provided by their governments.

Published in The Express Tribune, August 31^st, 2014.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.