Interview with Mr.M. A. Cheema

Face2Face
Mr.M. A. Cheema
Mr.M. A. Cheema
Federal Minister
MoTI - Pakistan
MoTI - Pakistan

Mr. Mushtaq Ali Cheema -Masters in Commerce is the Chief Executive of MSC Textiles Pvt. Ltd. Faisalabad. He is the pioneer in establishing dry ports in private sector in Pakistan. He also remained Chairman All Pakistan Cloth Exporters Association (APCEA) from 1993 to 1997, which is the biggest export association of Pakistan. His professional profile also includes his able Chairmanship for Faisalabad Dry Port Authority trust from 1999 to 2002. He is the founder of Citizen Police Liaison Committee (CPLC) Faisalabad and remained its Chief from 2000 to 2002. He was elected MNA from NA-83, Faisalabad in the general elections held in 2002. Since then under his able leadership he leads the Ministry of Textile Industry – Pakistan as the honorable Federal Minister. We cordially welcome h’ble Minister- Mr. Mushtaq Ali Cheema in our Face2Face Channel at www.fibre2fashion.com to privilege us & our visitors with the opportunity of an important & beneficial discourse on Textile Industry.

Can you draw an overall picture of Pakistan’s present day textile industry?

"The Structure of Pakistan Textile Industry can be categorized as below- A: LARGE MILL SECTOR: SUBSECTOR NO OF UNITS SIZE PROD Spinning Units 458 a) 10.906 M. Spindles b) 202356 Rotors 2290(M. Kgs) Composite Units 50 10416 Looms 925 Mln. Sq. Mt. Independent Weaving Units 150 27500 Shuttleless Looms 925 Mln. Sq. Mt. Finishing Units 115 -- -- Garments Units 800 -- -- B: SMALL & MEDIUM SCALE SECTOR: SUBSECTOR NO OF UNITS SIZE PROD. Independent Weaving Units 425 50,000 Looms Power Looms 245442 Looms 295442 Looms (Conventional Looms) 6192(M.Sq. Mtrs.)* 7117 Finishing 635 4600(M.Sq. Mtrs.)** * Include Large/Small scale independent weaving units & Power loom sector. ** Include Large/Small scale sector. Terry Towels 800 10000 Looms 700 shuttleless 160.00 M.Kgs. Canvas 2000 Looms 300000(Industrial) 35.00 M.Kgs.Garments 5000 450000(Domestic) (Sewing Machine) 56.0 M. Dozen Knitwear 1200 18000 80.0 M. Dozen "

Despite bountiful resources, what according to you ails the textiles and apparel sectors of Pakistan?

The distortion created by preferred treatments in the region and price war with due support from the Government of competing countries is impacting the industrial performance. However Government of Pakistan is constantly watching the factor in the competitiveness of its competitors and steps have been taken in this regard.

Could you enlist the steps taken by the Pakistan Government over the years to correct the situation?

"Government of Pakistan has taken various initiative steps to strengthen the textile sector and to make it compatible with the other Global Competitors in the end of quota regime some of them are under: Federal Textile Board has been established to take decisions for the development of textile industry. Campaign launched for the production of contamination free cotton & subsequent promulgation of Cotton Control Act 1966. Amendment in labour laws & factories act to make them ILO & ATC compliant. Policy support in shifting towards value addition. Establishment of Textile Cities and Garment Cities in the main hub of the Country i.e. Karachi, Lahore & Faisalabad. Gradual reduction exemption of import duty on textile machinery & parts to 5% added value except spinning rings on which it is 10%. Sales tax on the import and local supply of major inputs/raw material utilization in the entire manufacturing regime of Textile Industry have been zero rated. Import duty on raw material, Sub-components and components used in the local manufacturing of textile plants and machinery for export sector, has been reduced to zero % (SOR565(1 )/2005) Turn over tax has been reduced to 1% on retailers of specified textile fabrics and articles of apparel including readymade garments or fashion wear, The 15% Sales Tax levied earlier on retailers has been reduced to 2%, Both these taxes will be their final tax liability. Import duty on ginning presses has been reduced to 5%. 6% Rebate compensation on Garment Exports for R&D has been announced through the SRO. Custom Duty, sales tax and withholding/income tax on raw materials for the manufacture of textile has been zero rated at the Import stage to do away with the duty drawback/refund claims under the revised and simplified DTRE Scheme. Textile Garment Skill Development Board, SMOTS Schemes. SMOT scheme has been launched under Textile Garment Skill Development Board for on .job Training of Garment workers. This is a follow up action of Trade Policy 2004-05. Compliance Issues: The Issue of social compliance & environmental compliance has been addressed in FTB. Task force was formulated.On the Basis of Reports of the Task Force, Government has taken following initiatives; Effluent Treatment Plant in existing clusters of Textile Industry & was decided that Effluent Treatment Plants were compulsory as an infrastructure facility to setup a new Textile zone. After consultation with employers & employees Existing Labour Laws have been amended in line with ILO & WTO and cabinet approval has been given, Necessary steps for legislation are being taken."

Recent news reports indicate that textile industry is in disarray. It is said lack of pragmatic approach on part of the government, is being attributed for the state it is in today, as blamed by the industry and Pakistan's media- What is your views on this?

Disagreed! Government is reviving the situation every month & takes corrective action.

Can Pakistan's textile and clothing industry hope to gain from the prevailing textile crises that China is facing with the United States of America and the European Union?

Yes. Developing countries from Asia have shown increase in their exports, though these are lower than China but the restriction made on China will help other countries including Pakistan, based on competitive strength.

A record cotton output is forecast across the world. Pakistan is also returning with bumpers figure this year as reports indicate. What according to you will be the overall impact of this situation on growers, ginners, traders and mills in Pakistan?

This will be main strength of the textile industry & also a fair return would be ensured to growers.

Has the Trading Corporation of Pakistan (TCP) played its role as chalked out in helping out all stakeholders of Pakistan's cotton trade?

Yes.

Can you throw some light on the vision document for the textile industry of Pakistan?

Textile policy is under preparation.

With lack of trained manpower and obsolete technology in use how confident are you that Pakistan will not miss the global competitiveness challenges textile front? What sectors within the industry do you anticipate as growth stimulators among others?

Government is conscious of this fact. The scenario compels to have high-degree of skills. Major focus is more on skill development from top management to down to workers. Various skill development programs have been initiated by TUSDEC/TVETA/MoTI and Ministry of Labour in consultation with Trade Associations to meet this challenge. It will definitely help industry develop competitiveness. Regarding machine, it is not true that all the machinery is obsolete & outdated as Pakistan has most modern machinery in its spinning sector. Wet processing sector is being up- dated. How ever the core problem is the economy of scales i.e. SMEs could not survive in this open arena.

What role can India, Pakistan and Sri Lanka play in the global textile and apparel arena, and what do you perceive as commonalities among the three nations?

India & Pakistan have textile industry with complete value chain which is the major strength along with cheap labour. Sri-Lanka, Bangladesh and Nepal etc. have cheap labour and are focusing on garment-sector based mostly on imported fabric. However they stand good chance to support their poverty alleviation program.

Given the current state of bilateral trade relationship between India and Pakistan, what more can be done to improve relationship through the textile route?

With the inception of WTO concept of regionalism was boosted. Now it is on its boom & approximately 200 FTAs & RTA are under consideration however few RTAs are made with in the SAARC & ECO region as compared to other regions.

Can the textile industry hope for more incentives from the government of Pakistan to equip the textile industry to play a major role in the world, in the coming decade?

Yes, there is always a room for improvement.
Published on: 28/08/2006

DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.

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