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profit.com.pk
Monday, 02 April, 2012
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sobering eWS reports ahead of the last budget before the next vote betray sobering times for the government as the entire production-export machinery, along with its support structures, stands paralysed. Aptma’s concern that not only will the projected $16 billion export target be missed, but also last year’s $14 billion number, is serious. (The final expected figure is nearer $12 billion). So much for Dr Sheikh’s boasts at our prebudget seminar shortly before the last budget presentation. And so much for the ‘growing out of the downturn’ mantra. immediately following the last budget, we expected serious activity in manufacturing and industry, to build the capacity of incorporating value addition in our unimpressive export mix. Not only was no such concern ever evident, but the current base of production was also not protected. Three quarters of the outgoing fiscal saw 40 per cent of the textile sector’s production capacity compromised. The special concession at the eU, gained after throwing in everything including the kitchen sink, and the MFN status to india, will also likely go begging – there isn’t enough production capacity to cater to new markets. There’s more. All the time the power crisis was brewing – resulting in rioting mobs now – the government has been guilty of choking industry’s other precious lifeline – credit. islamabad’s ridiculous borrowing in the money market kept risk averse banks from lending to the private sector, compounding the production problem by engineering a destructive liquidity crunch. The result is obvious – exports have dropped, employment is chronically low, growth will definitely be mute and state bank’s printing presses will keep inflation high. That all these are likely to come together around election time is enough debate about the free market’s performance under a parliamentary democracy setup.
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Left high & T dry TexTile exporTers criTicise nonpaymenT of cusTom rebaTe for lasT Two years from faisalabad dry porT Textile export sector is a major forex earning sector to the tune of 13 billion dollar plus per year. Textile exports of the country are crumbling and the industry and business were squeezing due to non availability of funds
Any disruption in the tempo or bottleneck in export facilitation would not only hurt the exports of the country but also have devastating impact on the industry causing productivity loss, job losses and industrial unrest
Sakina HuSain
W
hile the number of heinous crimes grows at a compounding rate within the country, not a day passes when the common man (read educated bourgeoisie elite) laments moral degeneration and lack of justice in the country. it’s like reading Madonna’s biography and thinking: Are people really capable of this? And more importantly: Am i capable of this? The conclusion that has so far not been braced is that the jungle and its laws offer more liberty in addition to a plethora of opportunities to men. And thus back gliding in to animal hood is may be not such a bad idea! There are little hurdles and no accountability to be faced irrespective of whichever extreme the avatar turns to. in a country where the richest 10 per cent consume about 40 per cent of the country’s income and
FaiSaLaBaD INP
exTile exporters have criticized nonpayment of custom rebate for the last two years from Faisalabad Dry port model collectorate. Millions of rupees in rebate are stuck up creating severe liquidity crunch for exporters who are already suffering from continuous load shedding of electricity and gas in Punjab, said Rana Arif Tauseef chairman Pakistan Textile exporters Association talking to newsmen here today. Rana Arif Tauseef expressed grave concern over stuck up amounts of exporters on account of custom rebate regime creating liquidity crunch. Pakistani exports were already under pressure due to prevailing economic, financial, industrial crisis in the country as well as persistent law and order situation which were badly affecting the industrial and trade activities, the productivity output and workers employment, he said. Textile export sector is a major forex earning sector to the tune of 13 billion dollar plus per year. Textile exports of the country are crumbling and the industry and business were squeezing due to non availability of funds, he claimed. held up amounts of exporter’s funds under the above head have created financial crunch for the exporters and they are unable to increase their exports, it was contended. This was evident from the
12% decline in textile exports in February of current fiscal export figures. Overall growth in textile exports in the past eight months posted a negative growth of 7.5 per cent, as it touched USD 7.97 billion in July-February this year from USD 8.62 billion over the corresponding period last year. This declining trend in export sector if not checked immediately would be dangerous for national economy, he argued. The export sector was life line of national economy and was a very sensitive sector. Any disruption in the tempo or bottleneck in export facilitation would not only hurt the exports of the country but also have devastating impact on the industry causing productivity loss, job losses and industrial unrest, he said. Rana Arif said that severe shortage of energy was already almost devastating the manufacturing and industrial sectors rendering export units dysfunctional and this situation is resulting in the loss of production. emphasizing the importance of conducive industrial promotion and productivity augmentation conditions in the country, PTeA chairman said, to keep the industrial wheel running and providing maximum job employment to working hands in the country, it was imperative to facilitate the optimum industrial activity. PTeA chairman demanded the Government to bail out textile industry and exports from current crisis by removing hurdles and provision of necessary incentives to increase the textile exports of the country. he demanded early release of blocked funds in custom rebate regime to enable the textile exporters to retain their hard won export markets at this time of tough competition in international markets.
In search of equity the poorest 20 per cent earn less than nine per cent, it is no wonder why the population at large will never aspire to even day dream the American dream; entrepreneurial abilities and ambition in the face of zero resources and a discriminatory financial system get completely busted in front of the luxuries attached with looting and plundering. And let’s face it, how many people who have achieved fair and reasonable successes has the nation celebrated or been made to acknowledge in the last 60 years? The only role models that we have been able to identify with, belong to many many centuries ago, hence the common predilection to find solutions for today in the examples of yesterday long past. in search of evidence against inequity,
the road ironically exhibits the first clue of disparity. This arena has witnessed the onslaught of more than 400,000 brand new 1300-1600cc cars in the last ten years. Since, there have not been many climbing the economic ladder as far as the statistics show, this increase in the standard of living can only be ascribed to our very esteemed 10 per cent of the population. And this figure excludes those for imported and other high powered vehicles. in comparison, the middle class who form an estimated 50 per cent of the population, and can biasedly be assumed to be participating in the market for smaller cars (8001000cc) can said to have been benefited from an additional 600,000 cars in the last decade. Which brings us to the low income
group where much is left to be desired. Their children are underweight, deprived of basic nutrition which seriously impairs both mental and physical growth. There is very little or no constructive education, and no quantifiable asset creation. Furthermore, the government has nurtured their status as beggars by dolling out a thousand rupees per poor household (BiSP) and thus handed out about Rs35-40b in 2011 alone. if in this anti subsidy, lacking political will establishment, policy makers had actually cared about implementing projects for their “poverty alleviation” fetish, reasonable investments into employment creation would have been made for the poor making this subsidy self-sustainable over the longer run. economics differentiates between wants and needs. While the current growth in the economy is driven through producing commodities that satisfy the rich man’s wants, his custodian staff is somehow
expected to internalise and respect the fact that good things are not meant for his class. The results of inequity are not unknown. Prisoners occupy 222 per cent of the current capacity of jails, the total value of stolen goods in 2011 exceeded Rs560m, snatched vehicles were valued at Rs45m in addition to a higher number of murders, kidnapping for ransom etc. And one can always rely on the accuracy of these official reports! in the way of devising solutions, two clear paths can be delineated; invest more in security, guns, ammo, special forces and their paraphernalia. The second path, although much simpler may take a lot from this society as this prescribes sharing one’s bounties, believing in nature’s abundance and other such philosophical ruminations. i wonder which is the Muslim way! The writer is an economic researcher and freelance financial journalist. She can be reached at sakina.husain@gmail.com