LAHORE: The government is preparing to establish a national compliance authority to address sustainability and compliance issues, which have become increasingly important for international buyers, Adviser to the Prime Minister for Industries and Production Haroon Akhtar Khan announced on Saturday. “We are going to make very soon a national compliance authority,” he said. Addressing newly elected members of the All Pakistan Textile Processing Mills Association (APTPMA), the adviser said that Pakistan’s textile industry would need to strengthen compliance, sustainability and production standards to remain competitive in international markets. He added that the government also needed to address taxation and documentation issues affecting formal businesses. According to him, factories are easily identifiable and documented, which makes them more exposed to regulatory and tax requirements, while the wider supply chain can operate under different conditions. He said the long-term objective should be to document the entire economic chain, from manufacturers to retailers, without penalising businesses that are already part of the formal economy. While acknowledging that comprehensive tax reform was difficult under the country’s current fiscal constraints, he said broader reforms would be pursued as fiscal conditions improved. READ ALSO: Haroon, Cambodian minister discuss economic ties The adviser reiterated that the government’s role was to create an enabling environment while the private sector undertook investment, production and risk-taking. He said the government was working to rationalise tariffs, simplify regulations, improve trade facilitation and strengthen the investment environment. He also announced a series of regulatory and industrial reforms aimed at reducing the cost of doing business, improving competitiveness and boosting exports. These include risk-based inspections, a Bill of Rights for inspected businesses, the national compliance authority and sector-wise measures to address cost disadvantages. Urging manufacturers to move aggressively towards value addition, Haroon Akhtar said Pakistan should develop internationally recognised brands instead of remaining primarily a supplier to foreign brands. “If we want greater exports, we must move very aggressively towards value addition,” he said. He noted that Pakistan had been producing textiles for nearly eight decades without developing a significant number of global brands. “It’s been 79 years. It’s about time that we create our own brands,” he remarked, citing Khadi as an example of a Pakistani textile brand with international recognition. He said the industry had the skills, knowledge and capability to build more such brands. “Our challenge is no longer simply to produce more from the ecosystem that already has been created for textile. The challenge is to extract far greater value from it,” he said, urging manufacturers to shift from competing primarily on price to competing on innovation, design, quality, technology, reliability and sustainability. The adviser said the government was examining cost disadvantages on a sector-by-sector basis and would formulate industrial policies according to the circumstances of individual industries. Third-party comparisons are being undertaken to determine the cost disadvantages faced by different sectors and to assess the measures required to make them competitive. “My industrial policy is that in any sector with a 10-percent cost disadvantage, depending on the sector and depending on the power consumption, we have to look at it realistically,” he said. He added that energy-intensive industries, including those heavily dependent on gas, required particular consideration, while each industry would have to be assessed according to its position in the value chain. Acknowledging the serious challenges facing the textile industry, including high energy costs, taxation, liquidity constraints, access to finance, trade facilitation and policy unpredictability, the adviser was candid about the country’s position. “We are not competitive in our energy prices. We are not competitive in our taxation,” he said. He observed that access to finance was improving but remained considerably lower than in competing countries, while refund and liquidity problems had also eased but required further work. He stressed that these issues could not be resolved through occasional meetings whenever a crisis emerged, and called for sustained engagement between the government and industry. Speaking at the same gathering, APTPMA Patron-in-Chief Zubair Moti Wala urged the government to restore zero-rating, rationalise energy tariffs and cut the cost of doing business. He warned that continued pressure could shut more processing units and sharply reduce Pakistan’s textile exports. He said independent processing units are a critical link in the value chain, as grey cloth cannot be sold as a “Made in Pakistan” product without dyeing and printing, and noted that commercial exporters, who account for a major share of exports, rely heavily on these units. Highlighting the cost gap, Moti Wala said large groups have cut electricity costs to Rs15-17 per unit through wind and solar power, while processors pay about Rs53. Gas tariffs for processors are around Rs34, compared with Rs23 for some other industries. “How can we compete under these circumstances?” he asked. Citing Bangladesh, whose textile exports reached about USD54 billion by June 2025, he said Pakistani exporters are losing orders on price. Describing sales tax as the sector’s biggest problem, he argued that zero-rating would curb refund backlogs and fake invoicing. He also criticised the involvement of around 29 agencies in inspections. Claiming that 19 Karachi units closed last year, he warned, “Without these measures, the textile sector will become history.” He offered to present detailed cost data before parliament. Earlier, the results of the APTPMA Elections 2026-28 were announced by the Election Commissioner. Habib Ahmed Choudhry was elected Central Chairman, Muhammad Akbar Senior Vice Chairman, and Khawaja Shahzad Nasir Vice Chairman and Regional Incharge of the Lahore/Gujranwala Region. The elected Executive Members from the Lahore/Gujranwala Region are Khawaja Shahzad Nasir, Muhammad Akbar, Abdul Ghaffar Sethi, Rana Ahsan, Muhib Ullah, Muhammad Iqbal, Ghulam Sarwar, M. Nadeem, Maqbool Hussain and Faisal Ayub. On the occasion, Khawaja Shahzad Nasir thanked the members for placing their trust in him. He said he would work with dedication and sincerity, and in consultation with the members, for the betterment, development and strengthening of the textile processing industry. Copyright Business Recorder, 2026
‘National compliance authority’ on the cards: SAPM
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