Monday October 02, 2023

Sustainable policies

June 03, 2023

LAHORE: Trade associations play an important role in guiding governments towards sustainable policies by representing the interests of businesses within a specific industry or sector. These associations are formed by companies that operate in the same field, and they work collectively to promote the growth and well-being of their industry. All of these associations have sent their budget recommendations to the Ministry of Finance. Most seek additional concessions at a time when the government has withdrawn earlier concessions.

Unlike other countries, our trade associations have not established industry standards and certifications that promote sustainability. By setting benchmarks and guidelines for sustainable practices, these associations could help companies demonstrate their commitment to sustainability, enhance their reputation, and gain a competitive edge. Additionally, these standards can assist governments in formulating regulations and policies that align with industry norms and best practices. Moreover, there is a conflict of interest between recommendations from trade associations representing different sectors, such as the basic textile sector and the apparel sector. In these cases, the government should take a balanced approach to ensure the overall welfare of the economy and its stakeholders.

The government should carefully assess the recommendations put forward by each trade association. They should consider the potential benefits, drawbacks, and economic impact of each proposal. For example, to promote export growth, the government should be liberal in allowing the apparel sector to import all yarns and fabrics that are not produced in the country duty-free. This would broaden our export product base.The government should facilitate open and transparent discussions with both trade associations. This can involve inviting representatives from each sector to present their viewpoints, concerns, and evidence supporting their recommendations. The government should encourage constructive dialogue between the associations to find common ground. Additionally, the government should seek advice from independent experts, economists, and industry specialists so that they can provide the government with valuable insights into the potential consequences of each recommendation. These experts can offer a neutral perspective and help evaluate the trade-offs involved.

The government itself should conduct a thorough analysis of the potential economic, social, and environmental impacts of each recommendation. This analysis should consider factors such as employment, competitiveness, consumer interests, and long-term sustainability. If facilitating a labor-intensive sector also adds more export value, then its point of view should be preferred.

The government should take into account its broader policy goals, such as promoting economic growth, job creation, sustainable development, and consumer protection. It should weigh the short-term benefits against the long-term implications and align its decision with the overall national interest. If possible, the government should aim to find a consensus or compromise between the conflicting recommendations. This could involve negotiating with the trade associations and encouraging them to find mutually acceptable solutions that address the concerns of both sectors.

Once a decision is reached, the government should clearly communicate the rationale behind its choice, taking into account the analysis, expert advice, and stakeholder input. Transparency is crucial to maintain public trust and ensure accountability. The government should regularly monitor the implementation and impact of its decision. If necessary, it should be open to revisiting the issue, reassessing the situation, and making adjustments to its policies accordingly. It is important for the government to strike a balance between the interests of different sectors, considering the broader welfare of the economy and its constituents. The government should also study the policies of highly successful economies in the textile sector to find out the preferences they give to each subsector of the textile industry that boosted their textile and clothing trade.