Pakistan imports undocumented textiles worth $950 million from China

Pakistan imports undocumented textiles worth $950 million from China and $420 million textile products from India, besides accommodating yarn and fabric worth $321 million through Afghan Transit Trade, impacting productivity of the domestic textile sector, sources said. The textile entrepreneurs have expressed concern over lack of documentation in the international trade as the textiles official import-export statistics of Pakistan do not match with the official figures of the trading partners. “Is it connivance, incompetence or some flaw in the system,” wondered Adil Butt, a leading knitwear exporter. All Pakistan Textile Mills Association Chairman Gohar Ejaz said that the domestic textile industry was already paying very high price due to liberal import of used or worn clothing in Pakistan. Pakistan’s population is almost one-tenth than India, however, its worn clothing imports in 2009/10 were 2.529 million kilogram against the import of 1.663 million kilogram during the same period in India. He said the per capita usage of used clothing in Pakistan is 1.48kg against 0.15kg in India. ‘This gives Indian textile sector a huge advantage, which we do not have,” said Ejaz. Yarn and type of fabrics imported through the Afghan Transit Trade is not consumed or used in Afghanistan, he said, adding that these products enter Pakistani market without payment of any government levies and reduce the market for domestic yarn and fabric. A leading spinner M I Khurram said that despite free trade agreement with China, import of textiles from the neighbouring country is still subject to some government levies, as well as sales tax. Pakistan’s official statistics reveal that it imported textiles worth $535.59 million from China in 2009/10, he said, adding that the Chinese official statistics of textile exports to Pakistan revealed exports worth $1.481 billion. “From which channel or under whose approval approximately $950 million worth of textiles entered Pakistan?” He questioned. “Obviously, the entire import must have been duty-free,” he said, adding that this denied the domestic textile sector a level-playing field as they pay duties and taxes on their domestic sales. The entry of Chinese textiles worth $950 billion without the knowledge of Pakistani authorities means that the textile market worth Rs81.7 billion has been lost to unjust foreign competition that cannot take place without the connivance of the authorities concerned, he said. APTMA former chairman Abid Farooq said even with India the official textile imports of Pakistan do not match with the documented exports of textiles made by Indians to Pakistan. He said in 2009/10, there was a difference of $420 between Pakistan’s import figures and India’s export claims to Pakistan. The domestic industry in 2009/10 lost local market worth Rs36.1 billion to Indian textiles that were not documented in the official record of Pakistan, he said. Leading spinner and Punjab Industrial Estates Chairman S M Tanveer said that it is a tribute to the resilience of the local textile sector that it is braving undocumented imports worth Rs145 billion, acute power and energy shortage, high inflation and killing interest rates and even then posted a growth of 40 percent last year.