Government to support leather sector
The officials of the Ministry of Commerce (MoC) and Trade Development Authority of Pakistan (TDAP) and representatives of Pakistan Tanners Association (PTA) met to resolve the issues of leather exporters. Tariq Iqbal Puri, Chief Executive, TDAP, assured full support for facilitating the development and export of the leather sector, especially to stop smuggling and mis-declaration in export of wet blue leather. He said the FBR would be approached to check such exports by unscrupulous elements.
Puri briefed the participants about the role of Ministry of Commerce and that TDAP would protect the interests of the leather sector. He also directed the concerned Division of the TDAP to take urgent action on measures suggested by the PTA for controlling the mis-declaration and smuggling of pickle and wet blue. Director General, TDAP and a representative of PTA would also visit exporters and brief them on the issue.
The TDAP Chief Executive assured the PTA that all subsidies of PTA members in connection with exhibitions will be released within one month and those related to outstanding claims on lab test and effluent treatment plant will be released once PTA members submit complete documents and funds are released by the Ministry of Finance.
TDAP and PTA would devise a strategy to check the export of raw/wetblue leather and MoC/TDAP would consider it mandatory for members of PTA for exporting leather skins to ensure that only genuine exporters are benefited.
The MoC would support the PTA for complete ban of export of live animals so that raw material should be made available for the local industry and also for the much needed value addition required in the leather sector.
According to Agha Saiddain, former Chairman, PTA, Pakistan was still leading in quality of finished leather and some of the articles are even better than Italian products which enjoy number one position at the global level.
Hailing the decision being taken by the MoC and TDAP, he said most of the World Trade Organisation (WTO) signatory countries have either imposed very heavy duty on export of wetblue while some have imposed complete ban on export of this product. In India there is 60 percent export duty on wetblue while the Pakistan leather industry, the second highest foreign earning sector is facing acute shortage of wetblue, the basic raw material for the tanning industry, he added.
Export of raw skins, pickled and wetblue leather may be temporarily banned under Article XI of General Agreement on Tariffs and Trade (GATT). Saiddain said finished leather was not only causing loss to the government through duty evasion but exporters were claiming export rebate on such consignments. Export of Full Container Load (FCL) of leather may be allowed through Karachi, Lahore, Multan and Sialkot only i.e the main cities where the tanning industry is located.
He added, all FCL exports of any kind of leather should be allowed after obtaining verification certificate from the PTA, like Rice Export Association of Pakistan and APTMA. Any leather shipment weighing more than 7-8 tonnes should invariably be referred to PTA for checking/verification. Pakistani tanners are second to none at the global level and have the capability to convert wetblue into highly value added products.
S. M. Naseem, Chairman PTA; S.M. Muneer, Chairman of Din Group; Naseem Shafi and Gulzar Firoz attended the meeting.