Pakistan is facing a challenge to turn the GSP Plus conditions into an opportunity as textile companies although best but unaware of how to avail the duties and tax concession under GSP Plus given by the European Union to Pakistan.
To put this is place Trade Development Authority of Pakistan (TDAP), along with a foreign consultant, has shortlisted seventeen textile companies to guide them about availing the maximum benefits from the generalised scheme of preferences (GSP) plus status.
Textile companies from Sialkot, Lahore, Karachi and Faisalabad are being selected and now being trained in exporting skills and complying with the 27 UN conventions, requirement to avail GSP Plus. Of all, two are large, four small and remaining are medium firms relating to sports ware, readymade garments, leather and home textile.
The official at CBI, which is working under the Ministry of Foreign Affairs of the Netherlands said that they made basket of companies so that knowledge could be transferred to every segment of the textile sector. No country can solve all its problems, he said, hoping Pakistan will succeed in GSP Plus.
Even the Netherlands could not eradicate child labour menace. Some Dutch children sell newspapers for earning pocket money. In Pakistan case, it has to start with a certain point. Prosperity begins from education and women empowerment. When companies earn more they must go for corporate social responsibility.
The CBI appreciated the governmentâ€™s efforts in clinching GSP Plus. For the last three to four years, government is really trying to build confidence of business community.
An uphill task is to maximise the benefit from this status by implementing all United Nations conventions. A majority of Pakistani companies doing business with Europe is already complying with those conventions in their factories. A thing, which is missing, is a compliance system, which could show to the world that Pakistan is really implementing and guarding the human rights through these conventions. Almost all the conventions are directly related with the government. For example, capital punishment is not in the hand of businesses. Child labour is something that businesses can control. Both the government and businesses have to work together to ensure implementation of the conventions.
TDAP has launched training for trainers programme for the implementation of audit system, analysing what should be done in a given timeframe.
The CBI advised TDAP to train the highly capable officer for these audits so that they could perform training in future. This intensive training programme is a baggage for those officers who conduct these training further and also translate the audits into the suggestion for the new policies.
About foreign investment, investments by Chinese and Japanese pose a big threat to local businesses in Pakistan, which without spending on innovation will fail in competition war.
These Chinese and Japanese companies invest in product development and innovations availing the opportunity to explore their business.
If Pakistani business community does not invest in expansion in the next few years, they will be driven out, losing international market shares to local foreigners.
Exports from Pakistan rose by 20 percent during the last six months following the GSP (generalised scheme of preferences) plus status. Textile sector is expected to grow by 20 to 30 percent during the next three years.
This growth need to be translated into more investment in the factories product development, innovation and energy. Only then, local business could compete in the world.
Pakistan will be capable of competing internationally if it will invest in product innovations, better equipment and education. Within five years, Pakistan will be like Cambodia, Myanmar and other countries. Currently Pakistani businesses are competing on price and focusing on only traditional products selling against the lowest prices.
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