Pakistan has lost 0.49 per cent of its global share of leather export during last five years from 1.25 per cent to 0.76 per cent or $1.048 billion which is alarming.

Countries like Italy and Vietnam with very little livestock population have 13 per cent and 6.22 per cent of global leather market share respectively and Pakistan with total livestock of 160 million have only 0.76 per cent share in global marketThis was stated Pakistan Tanners Association central chairman Agha Saiddain while talking to The Nation here on Sunday.

Agha attributed this decline in exports to energy crisis, cost of doing business which has gone up due to impact of war on terror, lack of level playing field, smuggling and export of live animals under the shelter of quota system, export of wet blue leather and withdraw of government subsidy on participation in international fairs.

“Pakistan stands at second position in term of production of quality leather in the world, but is unable to tap the existing potential due to a number of reasons,” he said, saying China, India and Bangladesh have been showing 46.67 percent, 40 percent and 17 percent growth in leather sector export, respectively, while Pakistan’s exports declined by 14 percent.

He said that Pakistan’s leather industry contributes 4.42 percent to export earnings. This sector is an employment intensive providing jobs to more than one million. The global exports of leather sector rose by 40 percent from $98 billion to $137.96 billion, while Pakistan’s exports were down by 14 percent from $1.220 to $1.048 billion. Pakistan’s share in the global exports was reduced from 0.76 percent to 0.49 percent, said the chairman.

The export of live animals should be stopped from Pakistan under the quota system as well as smuggling of live animals from Pakistan, which are detrimental to the leather industry and at the same time it not only increases the prices of meat and milk, but also hampers the livestock wealth.

He said that with a view to double exports in next three years to $3 billion, the formation of Export Promotion Leather Council under Strategic Trade Policy Framework 2012-15, is now in final stages and the Ministry of Commerce is constantly in consultation with the industry while the PM has already given his consent in this regard. He informed that the restriction of just three years’ participation by the members of PTA in the international fairs has been withdrawn.

The TDAP has now announced to continue financial support to the participants of global exhibitions and there is no limit in this regard, said Agha.PTA chairman said that Commerce Ministry has also proposed in new three-year Strategic Trade Policy Framework to hand over control of Export Development Surcharge to the commerce ministry, which is presently controlled by the finance ministry.

It is to be noted that government has stopped funding local industry through EDS to participate in international industry fairs. The government collects 0.25 Export Development Surcharge on export, which amounts to about Rs250 million annually. PTA chairman said that Secretary Commerce Munir Qurashi agreed to problems of industry and promised that Duty Draw Back Rates pending with Input Output Coefficient Organisation (IOCO) will also be decided very soon.

Replying to a question he expressed surprise on the orders notified by DCO for closure of every kind of leather hide and skin business within the limits of Municipal Corporation limits of District Multan.

He observed that city government Multan fails to attach any importance with the leather business which is the second largest export earner for the country. Moreover, without allocating an alternate business space, such an order would only to create panic in business quarters and to provoke unrest amongst the leather business community. He stated that industries have invested millions of rupees in the infrastructure and business circle.

Therefore, an overnight order to roll back all the productive business activity is nothing but thoughtlessness and absence of concern for the a billion dollar earning export industry. He added that this measure would break all supply chain of leather making industry which is already facing scarcity challenges of raw material, along with power and gas outages.