LAHORE - The knitwear industry is in dire trouble as the number of knitwear exporting units has declined from 1183 in 2005 to 840 in 2009 and the closed
units include some of the most efficient high tech larger factories in this sector.
This was revealed in the presentation on the state of knitwear industry in Pakistan given by Pakistan Hosiery Manufacturers Association to the Lahore
Economic Journalist Association(LEJA). President Leja Mansoor Ahmad, Genral Secretary Muhammad Sudhir Ch also in this occasion. The presenters stated
that Pakistan has the most efficient and high tech knitwear industry in the region that produces better quality clothing then its competitors and closure of
over 30 per cent of the industry should be an eye opener for the economic planners.
They attributed the decline to flawed government policies. They said that government withdrew the R&D facility although its own statistics revealed that after
grant of this facility the knitwear exports increased at a high pace.
Highlighting the importance of clothing sector former chairman PHMA Shahzad Azam said that clothing sector provides highest number of jobs in textiles
and adds highest value to exports as well. He said one bale of cotton earns foreign exchange worth $238 only while knitwear exported from one bale of
cotton fetches $1600. He said $1 million additional investment in spinning or weaving creates 34 new jobs with additional exports of $270000. He said $1
million additional investment in apparel sector generates 460 job and additional exports of $3.2m.
Vice chairman PHMA Adil Butt deplored that the government continue to levy 3.36 per cent txes on exports despite claiming that exports are zero rates. In
addition it deducts 0.58 per cent of the export value as workers welfare levies, he added. Besides enormous increase in utility rates the inflation has increase
from 4.2pc to over 20 per cent and minimum wages from Rs2500 to Rs6000, he concluded. Comparing the facilitation provided by the competing economies
leading exporter M I Khurram said China increased its rebate on exports from 13 to 15pc from Feb 1, 2009. India gives 9.5 per rebate to its apparel exporters.
The export rebate in Pakistan he added is only 0.6 per cent. He said 6 per cent R&D support has been withdrawn. The export refinance has increased to 10.5
per cent from 7pc last year.