PAKISTAN: Government approves new textile policy
BharatTextile.com (subscription), India
KARACHI: The Prime Minister has approved the new Textile Policy (NTP) which will help increase the output of textile products, improve global competitiveness and generate employment in the industry.
The new policy targets a 40 percent increase in exports and meet the growing domestic demand. It will help create 3.5 million new jobs.
The government will continue to support the private sector in its efforts to modernize itself, increase productivity and competitiveness of its products, the Prime Minister said. We need to produce value-added products, particularly garments, so as to create jobs and higher exports, he added.
The NTP lays down short, medium and long-term steps. The first important step is to increase domestic cotton production which puts Pakistan in an advantageous position because of its reasonable price. Other measures include – improvement in value addition, increase in the number and variety of value-added products, enhancement of productivity of manpower, stepping up efficiency of its existing plants and equipment, and extensive use of the imported machinery.
The industry needs efficient management, labor and plant practices.
Five new model garment factories will be established. A textile park will be set up to serve as a special economic zone for tax free production and export. A weaving city will be established.
Other highlights include – formation of Pakistan Textile Research and Compliance Organisation, audit for processing industry for an efficient and economic use of costly chemicals, setting of a state-of-art textile laboratory at National Textile University Faisalabad, horizontal and vertical integration to balance textile value chain, a specialized garment training institute for women, one-window facility for providing required infrastructure and standardization of machinery and equipment.
The financing facilities include subsidized credit and refinance facilities provided by SPB through the commercial banks, Export Finance Facility (EFF) for textiles. The SBP has allowed swapping of costly long term bank credit, obtained previously by the industry, with cheaper Long Term Finance for Export Oriented Projects (LTF-EOP) for machinery and equipment. The industry is now allowed to undertake External Commercial Borrowing (ECB) for plants and machinery.
Pakistan plans to raise its overall exports to $ 40-45 billion by 2013, by expanding industrial, agricultural and services sectors, including textiles. “The government is focusing on skill development, and on reducing the cost of doing business to achieve this export target, the Prime Minister said. The Prime Minister said that it is important to build brands, working on the existing strengths and create competitive advantage internationally.
