KARACHI: Uninterrupted power and gas supply remained a pivotal factor for smooth and safer processing of hides and skins of sacrificial animals collected on eve of Eidul Azha, Pakistan Tanners Association maintained.
These utilities are vital need of sector for smooth execution of exports orders and fetching precious foreign exchange for promotion of country’s exports. PTA senior executive member Agha Saiddain said this year-2017, probably more than 13 million hides and skins were expected to be received from sacrificial animals in the country.
The export of leather goods and allied articles would likely to suffer a decline of around $325 million to $375 million in case the government fails to ensure uninterrupted supply of electricity and gas to leather sector for next two months immediate after first day of Eid.
He said this raw material industry desperately needs the uninterrupted supply of power and gas to enable the leather manufacturers for smooth processing of these perishable hides and skins within the humidity climate of country otherwise PTA’s leather manufacturing units would be in great problem in processing the raw material to become finished leather with necessary addition and face financial loss.
Mishandling and inexperienced way of preserving skins by stakeholders during three days of Eid also inflicts a loss to around 22-25 percent of collected stuff.
The country would also be deprived of the foreign exchange in failure of timely execution of export orders for meeting the foreign buyers’ demands. The leather sector exports have declined around 21 percent during last eight months 2017 from $1.221 billion in FY 2008-09 to $991 billion in 2016-17, said Saiddain.
The growth rate of leather sector exports was in minus and exports reduced to 18 percent as against positive growth in the region with 50 percent, 44 percent, and 110 percent in China, India and Bangladesh, respectively during last eight years.
He said Commerce Ministry should discuss problems of this important sector, which was providing jobs to about 1.0 million people across the country.
Pakistan has lost 36 percent global market share whereas the global growth rate from 2009 to 2016 was 45 percent.
The global share of Pakistan was 1.32 percent during 2007-08 in total global market size of $99 billion. The global market has grown to $144 billion during 2016 whereas Pakistan exports reduced by 18 percent during this period. It is strange country rich in livestock has just 0.77 percent global market share as against global share of 38 percent, 15 percent, 6.6 percent, and 3.55 percent for China, Italy, Vietnam and India, respectively.
The governments of these countries are paying special attention to the leather sector of their respective countries being labour intensive and providing jobs to the weaker section of the society. India alone has injected Rs 4,000 million, Rs 9,130 million and Rs 12,510 million under 10th, 11th, and 12th Indian Leather Development Plans, respectively.
On the other hand under Strategic Trade Policy Framework (STPF) 2015-18 Leather Export Promotion Council was formed without any single initiative by government during last many years.
PTA has been requesting time and again government for ‘priority status’ of sector but except announcement of Leather Export Promotion Council there is not a single practical step towards uplift of the sector.
Export of wet blue leather is another important factor retarding growth of our leather sector. Pakistan is at number two position after Italy as far as quality of leather is concerned and under these circumstances it is not difficult for leather industry to achieve the same growth rate of 50 percent. PTA has asked University of Veterinary and Animal Sciences under European Union Pakistan Leather Competitive Improvement Programme to continue event for preservation of hides and skins during Eid-ul-Azha 2017.
PTA had held a number of seminars in Lahore and Karachi, the major skin and hides collection cities with collaboration of UVAS and PLCIP. The objective for holding the sessions was to raise awareness amongst hides and skins collectors on how to preserve precious stock of hides and skins collected on Eidul Azha.
Saiddain said that lack of awareness along with improper management of raw stock on last Eid cost the leather sector more than Rs 4.2 billion and precious foreign exchange earning in shape of wasted or putrefied hides and skins.
PTA demanded of government to ensure uninterrupted supply of power and gas to the continuous processing tanning industry at Karachi, Lahore, Kasur, Sialkot and other cities of the country which was imperative for smooth processing of hides and skins of sacrificial animals to be collected on this Eid.
Published in Daily Times, August 29th 2017.