More than a dozen of Pakistani textile units have finally decided to shift their production units to Bangladesh in an aggressive move to cut their production cost, which they say is almost half of Pakistan's.
Representatives of different textile associations claimed that about 20 units of bed linen, readymade garments (RMG) and knitwear had finalised plans to shift their production units to Bangladesh and it could take a month or two to set up or acquire any of the already running units in Bangladesh, according to a report received in the city Saturday.
"The plans were discussed with the Bangladeshi consul-general in Karachi and also with senior officials of his country during Prime Minister Khaleda Zia's recent visit to Pakistan," said a senior Pakistani textile industrialist, who asked not to be named.
"Some of our members have already visited Bangladesh individually and in groups, and they have enough study to initiate production there with initial investment," said the industrialist.
However, he did not give the exact number and category of units, which had decided to move to Bangladesh, but said bed-wear and RMG manufacturers were among the frontrunners.
The Pakistani textile industry early this year had announced that they would move their units to Bangladesh, which offered a tax-free investment opportunity to the Pakistani industry.
The power corridors in general and the newly-established textile ministry in particular got serious shocks last month, when representatives of several textile bodies visited Bangladesh, where they met major textile players and were offered incentives.
However, the textile ministry of Pakistan believes that not a single industrialist has finally decided to move to Bangladesh.
"We have met textile representatives several times," said Syed Masood Alam Rizvi, federal textile secretary of Pakistan.
"The government is finalising incentives-laden proposals for the textile industry, but it may take time and until then I don't think there would be any serious move from the industrialists," Rizvi added.
He said the ministry had also approached the government agencies concerned, including the Central Board of Revenue, as most of the issues and complaints from the textile industry related to the tax authorities.
"Recently, I met the knitwear people, who also has some complaints and they were assured that their problems would be addressed at the earliest," said Rizvi.
Textile exporters witnessed a sharp decline in orders mainly for bed-wear products from European countries after the European Union (EU) in March 2004 imposed a 13.1 anti-dumping duty on imports from Pakistan claiming cheap Pakistani products were causing injury to the local textile industry.
Bed-wear is one of the five items belonging to a billion-dollar club of the textile groups, including yarn, cloths, knitwear and RMG. Pakistan is among top five textile goods exporters across the world as on an average the country exports over $8.0 billion textile products every year.
