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The Southern India Mills’ Association

Committed to Foster the Growth of the Textile Industry

Govt must resolve issues faced by manufacturers to increase exports

Pakistani rulers should take cue from the way the leaders of emerging economies operate to push up their manufacturing sector.
They interact on a monthly basis with the leaders of associations and industrialists to listen to and resolve their immediate issues.
The tone was set by the president of South Korea in 1970s, who met the manufacturing sector representatives once a month to listen to their problems. The government and the manufacturers sorted out the issues and instructions were immediately issued to the bureaucracy to implement the decisions.
When the president met the manufacturers the following month, the progress on the previous month’s decisions was reviewed. If there was delay from the government side, the bureaucracy was severely reprimanded.
The monthly meeting was religiously held and presided by the president, who ultimately removed all bureaucratic red tape and improved government services to global level.
In recent years, Narendra Modi of India presides over a monthly meeting with industry leaders to remove minor irritants faced by the manufacturers from public servants. Despite excellent government policies, Indian economy was under pressure when Modi assumed power.
In view of the global recession at that time, he took measures to facilitate exporters that in turn promised higher exports. The businesses delivered, as the monthly meetings discussed both the things that government had to do and the update on the promises of the businessmen.
The monthly meetings are still on and the progress from every exporting sector has diversified Indian exports both in terms of sectors and destination.
In Bangladesh, the head of the textile exporters association sits in the prime minister’s secretariat. The prime minister is available to the textile head whenever needed.
This system remains operative irrespective of the fact who is in power in that country. All irritants to textile exporters are addressed on priority.
Bangladesh is perhaps the only country in the world where the growth in textile exports remained robust even during deep global recession.
In Pakistan, former Prime Minister Nawaz Shariff announced to meet leading businessmen once a month, but except for a meeting or two he remained unavailable to the businesses. Even his finance minister could not find time to listen to the grievances of exporters.
After PTI assumed power, it was expected that Prime Minister Imran Khan would proactively woe the manufacturers and hold regular monthly meetings with them.
Unfortunately, some elements in the ruling party assumed some businessmen to be pro PML-N or pro PPP. So they ruled them out for interaction at official level.
Instead, a set of 22 prominent businessmen were named in a panel that was to interact with the prime minister regularly. The handpicked businessmen (on political ground) are no doubt respectable in the business community, but they are not representatives of the industrial associations.
The industrial associations elect their representatives democratically, who then represent them on public forums and plead the case of their sector with the government.
The PTI government should have included heads of different industrial associations among the panel of businessmen that the prime minister intends to interact with periodically. The PM would be able to listen to the problems of each manufacturing sector.
He would also have realised that the problems of one sector were in conflict with the issues of the other sector. He could then have formed a committee of experts to formulate the policy that was in best national interest. The economy would then start moving in a cohesive manner.
It is strange that the manufacturing economy is not moving in the right direction, although the labour and other cost indicators reveal that the manufacturing cost in Pakistan is the lowest in the region after massive devaluation of Pakistani rupee.
The minimum wage for instance is $170/month in India, $240/month in China, $95/month in Bangladesh, $145/month in Vietnam and $120/month in Pakistan. The land cost or leasing cost per square meter in India is $80, it is $40-80 in China, $140 in Vietnam and $20-50 in Pakistan.
Industrial water cost per month is 46 cents in India, 45 cents in China, 30 cents in Bangladesh, 48 cents in Vietnam, and only 18 cents in Pakistan. Diesel rates or transportation rates are 105 cents/litre in India, 102 cents in China, 78 cents in Bangladesh, 80 cents in Vietnam, and 80 cents in Pakistan.