LAHORE: When we discuss our failures, we miss the point that our political system provides opportunities to all politicians to protect their vested interests, and it is not confined to only businessmen-politicians.
We have not developed a policy that checks the promotion of vested interests. There should be a transparent policy that puts checks on all politicians, particularly those in power, which ensures that their decisions do not promote their interests. It is up to the political leadership to assess the competence and integrity of the person before assigning responsibilities in the economic field. There is no doubt that a businessman is well aware of the bottlenecks created by flawed policies for the entrepreneurs.
There is no harm in benefitting from this experience. However, a transparent system of check and balance is essential to check any excesses by such a person to promote his business interest.
This is done all over the world, and the checks are so strong that only persons with national dedication and integrity dare to accept assignments in economic ministries. No industrial policy in Pakistan would work until all the economic ministries work in cohesion. The Ministries of Finance, Environment, Water and Power, and Petroleum and Natural Resources should be on the same page if any government wants to achieve the target of accelerated industrialization.
We know the bottlenecks in our economic system, but no government dares to take corrective measures in the real sense because the political bottlenecks are protected by highly influential vested interests.
A glimpse of vested interests can be seen in the textile sector where most subsidies and concessions are grabbed by the low-value-added spinners and weavers. The value-added apparel sector has a nominal say in the formulation of textile policies of the country. Even industrialization in the Textile sector has remained spinning-centric. We produce yarn for our exporters and their competitors in other economies. Pakistan's textile industry exports 75 percent of its products and is hardly able to market the remaining 25 percent in the local market. In China and India, around 75 percent of their textile production is consumed domestically. Despite having a capable textile industry, policy flaws have encouraged consumption of imported textiles in Pakistan. The gents' and children's wear market is in the hands of producers in the Far East and China, while women's fabric comes from China (both legally and smuggled) and from India through smuggling. The old clothing is another big source of imported textiles. We have made inroads in the domestic ladies' fabric market in the last ten years.
A paradigm shift in textile policy is imperative to ensure sustainability of the local textile sector that goes under severe stress when exports are impacted by any global slowdown. The government should study how India, Bangladesh, and even China manage to restrict foreign textiles in their markets. Moreover, they should consider banning used cloth imports that are conduits of smuggling of new clothing. India still houses more than double the poor in Pakistan but it does not allow import of used clothing and their textile industries are flourishing.