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Textile sector seeks energy, not subsidies

The textile industry alone is sitting on export orders worth $3 billion that it cannot accept due to energy shortages,” said Gohar Ejaz, group leader All Pakistan Textile Mills Association (APTMA). In Pakistan, there is no dearth of export orders. Moreover, textile entrepreneurs have made sizeable profits in the last few years and are ready to modernize production techniques to take on more orders. The only impediment is a pressing energy shortage, he explained. “Pakistan need not go to the IMF if exporters are guaranteed uninterrupted power supply,” he said. He clarified that the textile industry is neither asking for subsidies nor any other concession, except constant power supply. Disillusioned with the present government, Ejaz said: “New energy managers appear to have been hoodwinked by the bureaucracy that is trying to maintain status quo as it suits a culture of rent seeking.” Leading auto parts exporter and former CEO Engineering Development Board Imtiaz Rastagar believes unrest in the country is connected with unemployment and it poses a serious concern. “I can double my exports if power supply is normalised,” he said. He believes the same is true for other exporters. “Pakistan is losing a billion dollars in engineering goods exports due to a crippling energy crisis,” said Rastagar. Arguing in favour of exports, he said exporters pay higher wages than local businessmen. Domestic producers are also under pressure as their cost of production has risen. Cheaper, imported goods are therefore replacing locally produced ones, he said. Former chairman TUSDEC Almas Hyder believes imprudent use of available power created the need for protectionism. He believes the government should operate on the principles of free market economy and create new jobs in exports. In this vein, industry should be given priority in the supply of power till the energy crisis has been resolved, he urged. If large scale lay-offs continue, there will be an increase in calls for protectionism, warned Hyder. “This is a concern because we all know that in the wake of protectionist policies, mass unemployment, inequality and greater conflict occur in the trade sphere. The argument that trade creates jobs is sometimes misused by those who claim that if exports create jobs, then imports must cost them,” he argued. Hyder said there is evidence to support the view that, by and large, exporters improve the quality of employment as they are innovative, invest in technology and achieve higher levels of productivity and profitability, compared to domestic businesses. An open economy means more employment opportunities but countries still need social safety nets and labour market institutions to protect the weak, he said.

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