The sources said that the package was finalised after the government had realised that the textile products especially garments were under pressure in the EU market due to duty-free access to its trade rival Bangladesh and 50 percent concession in duty to Sri Lanka, which is further hoping for a zero duty status on the basis of Tsunami tragedy, and subsidies paid to exporters in China and India.
They added that while the government in the meantime was lobbying hard to get a place in the new GSP Plus scheme it has also decided to offer a relief package to the exporters to provide them a level playing field in the EU market.
It may be pointed out that the garment sector has suffered the most after the elimination of quotas and expiry of the GSP scheme in 2004.
The government at last realised the gravity of the situation and want to save dollar one billion exports contributed mostly by SMEs in the garment sector, which faced threats of closure rendering about 200,000 workers.
The Pakistan Readymade Garments Manufacturers and Exporters Association (Prgmea) was the first to demand for a relief package and organised a seminar in December in collaboration with the Export Promotion Bureau on ramifications due to the closure of the scheme.
The summary of the relief package was discussed in the ECC meeting and the Cabinet, which directed the ministry to evolve a suitable package and present the same for final approval.
The relief package when approved would come into effect from January 1, 2005.