LAHORE: European Union Ambassador Raimundas Karoblis met with leaders of the All Pakistan Textile Mills Association (APTMA) to discuss extending Pakistan's Generalized Scheme of Preferences Plus trade facility beyond 2027, with both sides emphasizing the stakes for the country's largest export sector.
Karoblis, accompanied by First Secretary Kert Ajamaa, Development Cooperation Manager Theis Munksgaard-Hansen and Senior Economist and Trade Advisor Husnain A. Iftakhar, visited APTMA House in Lahore. He said Pakistan must demonstrate progress in implementing and legislating laws and conventions required to retain GSP Plus status.
The ambassador urged exporters to take immediate steps to implement the required conventions and engage with the government on concerns raised by the European Commission, particularly regarding human and labour rights, governance and environmental issues. Addressing those concerns, he said, would facilitate a possible 10-year extension of the trade facility.
Karoblis praised Pakistan's textile industry for its progress on sustainability, calling it a high priority in the EU's considerations for continuing the facility.
APTMA Chairman Kamran Arshad said the EU is Pakistan's largest trading partner and that GSP Plus has enabled the textile industry to compete more effectively in regional markets. The facility allows Pakistan to export 78% of its products to EU countries duty-free, he said, supporting employment, investment, technology upgrades and foreign investment while advancing greener economy and zero-carbon goals. Several textile companies are expected to reach net-zero carbon emissions by 2050, he added.
Arshad urged continuation of GSP Plus until Pakistan achieves economic stability, saying further export diversification could yield additional benefits. He warned that withdrawal would cost the industry at least 1 trillion Pakistani rupees (about $3.6 billion) annually, along with increased unemployment, mill closures and higher poverty.
He said the fallout would extend to banking, real estate, transportation and allied sectors, noting that more than 40% of bank loans go to the textile sector. Losing the facility, he added, could also undermine initiatives on environmental protection, human rights, labour and gender rights, anti-corruption and narcotics control.
APTMA Chairman North Asad Shafi told the ambassador that Pakistan's textile industry has imported billions of dollars' worth of textile machinery from EU member states as part of its expansion plans. He expressed hope that GSP Plus would be extended to support poverty alleviation and raise workers' take-home pay through improved skills.
Shafi also urged the EU to facilitate early finalization of a free trade agreement between Pakistan and the EU, modeled on the India-EU FTA, before any withdrawal of GSP Plus. He briefed Karoblis on APTMA's advocacy for GSP Plus compliance and its role in developing Pakistan's compliance infrastructure, outlining the proposed National Compliance Entity's facilitative, regulatory and dispute-settlement functions.
APTMA reaffirmed its commitment to meeting GSP Plus obligations, addressing compliance gaps and strengthening engagement with the government and other stakeholders until the reapplication process is completed and a comprehensive National Action Plan is developed.
