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Pakistan Leather Garments Manufacturers and Exporters Association (PLGMEA) demands government to urgently take measures to check decline in exports of leather garments and leather goods. The exports of leather garment declined 10 percent to $366 million in FY15 down from $406 million in FY14. In July 2015, the decline is 23 percent as compared to July 2014.

Fawad Ijaz Khan Patron-in-Chief PLGMEA said that in terms of quantity the decline was more than 30 percent which was very alarming. The exports of leather goods declined 24 percent during FY15 to $12 million from $16 million in the previous year. In July 2015 the decline is 50 percent as compared to July 2014.

He said the main reason for decline was unfavourable law and order situation in the country and high cost of production. "Pakistan's exporters are at disadvantage as compared to their Indian rivals as largest importers and buyers from European and North American are reluctant to visit Pakistan and most of buyers have set up their offices in India," he added.

"Our exporters cannot attract international buyers unless they give attractive prices. Due to our high cost of production our exporters cannot compete with Indian exporters. Therefore, it is suggested that our exporters be given five percent compensatory rebate to provide them level playing field in international markets," Fawad said.

He requested the government to implement the measures announced in the trade policy for boosting the exports of the country. Various measures announced in the previous trade policies could not be implemented due to lack of funds.

He said several projects approved by Export Development Fund Board for leather garments and leather goods valuing Rs 311 million were pending due to lack of funds. In addition, huge amounts of Customs, Sales Tax and Income Tax Refunds are pending for over one year and inspite of government assurances these refunds are not yet paid. Fawad suggested that the government should categorize exporters as Ultimate Finished Goods exporters and other exporters. More incentives should be given to Ultimate Finished Goods exporters as compared to other exporters of intermediary goods. "Ultimate Finished Goods exporters should be given export refinance at three percent whereas other exporters should get refinance at six percent," he added. The buyers of intermediary goods are mostly from China or Far East and they easily visit Pakistan but the buyers of Ultimate Finished Goods are Europeans who are reluctant to travel to Pakistan.

A delegation of PLGMEA led by Fawad Ijaz Khan, Patron-in-Chief, PLGMEA, will meet Prime Minister Nawaz Sharif alongwith other exporters on Friday to discuss measures for promoting the exports of leather garments and leather goods, he informed.-PR

Copyright Business Recorder, 2015

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