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LAHORE: With the approval of GSP-plus status from the European Union (EU), the federal government and the private sector have endeavoured to address economic issues for achieving exportable surplus through increased productivity and investment, said official sources here on Wednesday.
According to the EU, secretariat nations interested in obtaining GSP-plus status could apply to the secretariat from November 20, 2012. The applicants would have to ratify the relevant conventions, mainly related to human and labour rights, as required by the EU.
Several trade experts believe that Pakistan has about 10-11 months to complete these ratifications. Pakistan, they point out, has already ratified most of the conventions but a few related to human rights need to be signed. Other conditions, besides these conventions, have already been relaxed to pave way for Pakistan’s entry, they added.
Meanwhile, Prime Minister Raja Pervaiz Ashraf held discussions with the country’s entrepreneurs in view of economic challenges in Lahore. “After our interaction with the prime minister and his financial team, who seemed determined to remove hurdles impeding economic growth, we are optimistic about tackling these issues,” said Group Leader All Pakistan Textile Mills Association (APTMA) Gohar Ejaz. The prime minister seemed genuinely interested in addressing the economic issues confronting the country as he held three meetings with APTMA members on Tuesday, besides meeting entrepreneurs from different sectors.
“The federal government’s economic team was informed that such a significant market access opportunity would be wasted if productivity issues are not addressed and favourable investment climate is denied to the local industry,” said Gohar. The prime minister accepted APTMA’s offer to assist the government in speeding the ratification of relevant conventions, as required by EU. Moreover, the textile and other industrial sectors would ensure Pakistan’s smooth entry under the GSP-plus scheme, he added.
“We have offered to replace our gas and oil-fired generating units with coal-run power plants provided the government provides interest-free loans for the coal-run plants,” said APTMA Chairman Ahsan Bashir. He added that in the neighbouring India, five percent markup subsidy is provided by the government on new investment, while the state government picks up the remaining five percent interest to attract investment.
“These plants would produce 2,000 MW of electricity and could be operational in a year before the GSP-plus status is granted to Pakistan,” he said. “The response of the government’s economic team on these proposals was positive.”
According to Bashir, if their proposals are accepted they would be able to convert yarn and fabric worth $5 billion into garments and increase textile exports by $10 billion, as soon as Pakistan gets market access from the EU. “APTMA is ready to invest $2 billion in the garment industry if its proposals regarding interest subsidy on new investments and supply of continuous power are accepted,” he added.
Leading industrialist Anjum Nisar said that the prime minister was apprised about the power situation as well. ”The prime minister and his team of experts were pleasantly surprised to find out that the industries get 1,500 MW through independent feeders, where distribution losses are zero against the national average of 18 percent,” he said. “Pakistan Electric Power Company (Pepco) subjects these feeders to power outages during peak hours when the tariff is Rs15 per unit against the normal tariff of Rs10 per unit.”
He claimed that to save expensive furnace oil, some independent power producers have been closed by Pepco as power distributors incur huge losses on normal tariffs. However, he added, power is supplied only to the industrial independent feeders as the higher tariff at peak hours and zero line losses make it lucrative and commercially viable for Pepco to supply power to industries.
The head of Punjab chapter of APTMA Shahzad Ali Khan hoped that the prime minister would order regular power supply to independent industrial feeders during winter that would help the textile sector to add $4 billion in exports and save 15 million textile workers from periodic job suspension due to power cuts.
According to the EU, secretariat nations interested in obtaining GSP-plus status could apply to the secretariat from November 20, 2012. The applicants would have to ratify the relevant conventions, mainly related to human and labour rights, as required by the EU.
Several trade experts believe that Pakistan has about 10-11 months to complete these ratifications. Pakistan, they point out, has already ratified most of the conventions but a few related to human rights need to be signed. Other conditions, besides these conventions, have already been relaxed to pave way for Pakistan’s entry, they added.
Meanwhile, Prime Minister Raja Pervaiz Ashraf held discussions with the country’s entrepreneurs in view of economic challenges in Lahore. “After our interaction with the prime minister and his financial team, who seemed determined to remove hurdles impeding economic growth, we are optimistic about tackling these issues,” said Group Leader All Pakistan Textile Mills Association (APTMA) Gohar Ejaz. The prime minister seemed genuinely interested in addressing the economic issues confronting the country as he held three meetings with APTMA members on Tuesday, besides meeting entrepreneurs from different sectors.
“The federal government’s economic team was informed that such a significant market access opportunity would be wasted if productivity issues are not addressed and favourable investment climate is denied to the local industry,” said Gohar. The prime minister accepted APTMA’s offer to assist the government in speeding the ratification of relevant conventions, as required by EU. Moreover, the textile and other industrial sectors would ensure Pakistan’s smooth entry under the GSP-plus scheme, he added.
“We have offered to replace our gas and oil-fired generating units with coal-run power plants provided the government provides interest-free loans for the coal-run plants,” said APTMA Chairman Ahsan Bashir. He added that in the neighbouring India, five percent markup subsidy is provided by the government on new investment, while the state government picks up the remaining five percent interest to attract investment.
“These plants would produce 2,000 MW of electricity and could be operational in a year before the GSP-plus status is granted to Pakistan,” he said. “The response of the government’s economic team on these proposals was positive.”
According to Bashir, if their proposals are accepted they would be able to convert yarn and fabric worth $5 billion into garments and increase textile exports by $10 billion, as soon as Pakistan gets market access from the EU. “APTMA is ready to invest $2 billion in the garment industry if its proposals regarding interest subsidy on new investments and supply of continuous power are accepted,” he added.
Leading industrialist Anjum Nisar said that the prime minister was apprised about the power situation as well. ”The prime minister and his team of experts were pleasantly surprised to find out that the industries get 1,500 MW through independent feeders, where distribution losses are zero against the national average of 18 percent,” he said. “Pakistan Electric Power Company (Pepco) subjects these feeders to power outages during peak hours when the tariff is Rs15 per unit against the normal tariff of Rs10 per unit.”
He claimed that to save expensive furnace oil, some independent power producers have been closed by Pepco as power distributors incur huge losses on normal tariffs. However, he added, power is supplied only to the industrial independent feeders as the higher tariff at peak hours and zero line losses make it lucrative and commercially viable for Pepco to supply power to industries.
The head of Punjab chapter of APTMA Shahzad Ali Khan hoped that the prime minister would order regular power supply to independent industrial feeders during winter that would help the textile sector to add $4 billion in exports and save 15 million textile workers from periodic job suspension due to power cuts.
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