KARACHI: The Pakistan Tanners Association (PTA) has warned against the declining leather exports, expressing the apprehension that the situation warrants remedial measures lest Pakistan will lose leather goods market to Indian competitors.
According to PTA’s Standing Committee on Gas and Infrastructure Chairman Usman Umer, the incumbent government, instead of offering incentives to the ailing industry, unnecessarily overburdening it by levying unethical and unpractical taxes like Gas Infrastructure Development Cess (GIDC), causing more uncertainty for exports-oriented industry in future.
He said that the leather exports had declined by more than 14% during the last five years from $1.22 billion in fiscal year 2007-08 to $1billion in 2012-13, due to severe energy electricity and gas shortage.
“Leather processing is a continuous process and frequent power cuts have an adverse effect on leather and its quality. Due to this energy crisis and government’s decision to levy Rs 150 mmbtu cess on gas, the second largest export sector is facing stagnation for the last 5 years.
He pointed out that because of these reasons India’s exports picked up since May 2014 by 14%. India, by virtue of many incentives, including cheap gas, electricity and duty and tax rebates has doubled its leather exports to over $28 billion in just a few years.
