Pakistan's Textile Exports to EU Will Be Exported Duty Free From January 1, 2014

As per Annex-IX of the EU Regulation-978, the entire textiles and clothing products i.e. HS chapter 50 to 63 are included in GSP Plus Scheme and will be exported duty free from January 1, 2014 although the official Notification will be issued on January 6, 2014, Pakistan’s Minister of State for Commerce and Textile Industry Engr. Khurram Dastgir Khan told reporters while briefing them about the various aspects of the GSP+ trade preferences.

The Minister informed that the GSP+ scheme would be applicable until 2023, and was subject to various conditions such as the share of any GSP+ beneficiary country will not exceed 2 percent of entire EU imports, and ratification and reporting of 27 international conventions on good governance.

As per article 14 of the EU regulation, after every two years, the EU Commission will present a report to the European Parliament on status of ratification of the 27 international conventions, the Minister said.

The Minister said that textiles, along with agriculture and fisheries, are deemed sensitive and are under special safeguards in the EU. The textiles and clothing products are placed as Sections 11a (HS Chapter 50 to 60) and 11b (HS Chapter 61 to 63). If the country’s exports of a product exceed a threshold of 6 percent of total EU imports of that product, then safeguard threshold is 13.5 percent for annual increase of imported volumes.

Mr. Khan hoped that GSP+ Scheme would act like a catalyst to rejuvenate Pakistan’s entire export products range. “It will facilitate the complete textiles and clothing value chain to diversify their product mix as in various products in which we do not have competitive advantage will now be competitive vis-à-vis India and China due to zero tariffs,” he said.

However, Pakistan’s textiles and clothing values chain will also be required to upgrade their machinery and produce better value products, he added.

The Minister said that skilled labor is required to produce additional quantities and he would be ensuring release of funds from the Export Development Fund (EDF) to initiate various Training Programmes.

He also emphasized that in the long run, he would like to tackle all problems related to the cotton production sector, through legislation as well as interventions through scientific research.