Garment exporters seek safety nets in China FTA

Exporters from the garments and knitwear sector have approached the government to ensure safety nets while dealing with China on the proposed Free Trade Agreement.

The sources in the industry informed that leading associations of the sectors have approached the textile ministry under a fear that 'No Concession List' is not extended to the categories being manufactured and exported from Pakistan in the FTA with China. Particularly, the knit and woven goods fall in chapters 60, 61, 62 & 63 of Customs Harmonised Code and HS Code 54.07 of chapter 54 be placed in highly sensitive trade category instead of sensitive track category as at present.

In separate letters written to the concerned ministries, these associations have taken the stance that the above magnanimous favour to the home industry, providing 60 percent wage-earning to labour force, would come out of woods being hit badly be post quota regime.

Meanwhile, sources in the textile ministry said that assurance is extended to the associations that the government was offering reduction from 25 percent to duty to 20 percent on chapters 60 to 63 by 2022 under No Concession List and chapter 63 is already in the No Concession List. It is also pointed out chapters 54 and 55 have also been factored in.

It is worth noting that both the knit and woven sectors have joined $1 billion club in the recent past. But both the sectors, besides the basic textile, are passing through hard time. The government has also extended 6 percent research & development fund to both the sectors about two years earlier to ensure rapid growth in the exports but rising utility cost has wrecked through the knitwear and many manufacturers have closed down their units. The manufacturers of the value-added sector also believe that no tangible steps were introduced in the textile vision 2005 for them, an error that played havoc with these sectors. However, Prime Minister Shaukat Aziz has recently formed National Textile Committee that is trying to approach the stakeholders in both readymade garments and knitwear at present.