Pakistan textile upset over non release of technology upgradation subsidy

Pakistan textile industry looking to its Ministry of Finance releasing fund which was earmarked in the textile policy 2009-14 a Rs. 118 billion for lower interest subsidy for technology upgradation. In fact, the textile ministry has not even registered businessmen for the scheme.

During a presentation made by the All Pakistan Textile Mills Association (Aptma) to Textile Secretary Rukhsana Shah about the outcome of granting non-discriminatory market access to India. Yasin Sadik Sidik, Chairman Aptma revealed that India had introduced the Technology Up-Gradation Fund Scheme (Tufs) in April 1999. Up to 31 January, 2013, the subsidy amount came to $2.63 billion, which led to an investment of over $39 million in textile machines. While the Ministry of textile has not released a single rupee

Group leader Aptma Gohar Ejaz also disclosed that the Indian government has disbursed Rs1,046.60 crore till now under its another scheme for integrated textile parks, where more than 2,000 entrepreneurs would be setting up their units in these parks

Ejaz has proposed the Pakistani government to set up similar textile parks and urged the textile ministry to arrange land for this. According to him, in 25 acres of land, 200 spinning, weaving and processing units can be established. As for Aptma, they have planned to set up 600 megawatts of coal power project in this park.

Textile Secretary Rukhsana Shah has asked the trade body to submit the proposal in detail and also promised a fully implementable policy as soon as the present textile policy expires in June 2014.

The Aptma leader further informed that Indian government had also introduced major incentives on the introduction of new products and markets by the exporters. The incentive (subsidy) under the Focus Market Scheme currently stands at three percent. Besides, the Indian federal government provides institutional support to the textile exporters through different textile subsector-specific export promotion councils and textile research centers.

With Indian textiles strengthened by a load of subsidies, it will be difficult for Pakistan to compete in the textile sector despite have granted GSP plus status.