Tax free-investment opportunity has been attracting Pakistani textile industry and according to sources, about 20 textile units have decided to shift their production units to Bangladesh from Pakistan and several prominent textile industrialists working out plans to move over in a short while.
Production cost in Bangladesh is almost half of that of Pakistan and they get broader market access in there as there are no tariff barriers like the ones faced by products from Pakistan.
Different textile associations inform that 20 units of bed linen, readymade garments and knitwear have decided to move to Bangladesh and it may take a month or two set up or acquire running units there.
Pakistan's textile industry exports $8 billion of textile products every year and this situation has pushed government authority to offer incentives and stem the flight of local players to move to Bangladesh.
The Bangladesh government offers a tax-free investment environment to the Pakistani textile industry as it aims a $1 billion foreign investment within a year.
Bangladesh had earlier offered tax free investment to a 10-member delegation of leading bedwear manufacturers and exporters who visited the country early November 2005, while their meeting with Bangladesh Board of Investment, the Ministry of Commerce and the Ministry of Industries turned out to be successful.
Pakistani bedwear has been facing problems as the EU had imposed 13.1 percent anti-dumping duty on imports from there since March 2004.
EU had claimed that cheap Pakistani products adversely affect local players.
In January 2005, Pakistan entered the WTO regime and it is among the top five textile exporters of the world.
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