According to newspaper reports, the Ministry of Textile has warned that the textile industry is heading toward bankruptcyas export of textile products have decreased by five percent during the first two months of the current fiscal year. The ministry blames the Ministry of Finance for refusing to provide Rs 188 billionfunds which the government had promised under Textile Policy of 2009-14. Instead, only Rs 28 billion have been issued so far. On another note, the textile ministry also holds the Ministry of Petroleum and Natural Resources responsible for inadequate gas supply to this vital sector of the economyasthe industry is facing a gas shortfall of 33 percent against demand of up to 450 mmscfd.
The current state of affairs indicates that the government agencies are not on the samepage even on vital issues. Earlier, the prime minister had constituted a committee under Finance Minister Ishaq Dar to resolve the issue of the release of funds and gas supply to the textile sector but not a single meeting of the committee has been convened for the last six months. The delay in the resolution of the issues could cause $2 billion loss to the national exchequer in the current fiscal year and this amount is twice the fifth and sixth loan tranches extended by the International Monetary Fund (IMF) to Pakistan.
The share of textile exports stood at $13.8 billion against total exports of $25 billion in 2014, which is about 55 percent of the total exports earnings of the country during the year. The country’s total exports to the European Unionstood at $5.1 billion against $4.2 billion during 2012-13, showing an overall textile exports growth of 3.8 percent in two years.
The finance minister has yet to sign a draft of the new Textile Policy for 2015-19.The draft was sent to him for approval after the previous policy had expired in June this year. However, the point of concern is that the total exports of the country have decreased by 10 percent during the first quarter of the current fiscal year despite having duty-free access to the European markets.
The lack of coordination between the ministries is costing the nation billions of dollars while it also points finger at the performance of the government which claims that it has adopted export-oriented policy while in practical it is heavily relying on foreign aid.
