PAKISTAN
Situationer: Looking for work that isn’t there

Aamir Shafaat Khan Published January 31, 2023 

A SEVEN per cent drop in textile exports during the current fiscal year has brought about thousands of layoffs in the industry, putting daily wagers and contractual workers at risk of starvation. And this is “just the beginning”.

The situation in the auto sector is equally grave, as more than “250,000 people have lost their jobs” due to a dip in the sale of automobiles.

Mazhar Iqbal (not his real name), 32, has been jobless for a month. “I worked as a contractual employee in the quality inspection department of a textile unit in FB Area for six years. But after I proceeded on sick leave, my employer asked me not to come back to work because my ‘job does not exist anymore’,” he told Dawn.

Mr Iqbal and his family depend on his sister, who works as a doctor in the UK, for sustenance. He said that after spending more than six years in the industry, it has become difficult for him to switch professions. But his dilemma is that other mills are not hiring.

Over 400,000 informal workers from textile, auto sectors lost their jobs in first half of FY23; stakeholders urge govt to develop strategy to avert further retrenchments

“I have been trying hard to get the same type of job but officials in other textile mills say that they cannot hire due to lack of work owing to a dip in export orders.”

Sharing his experience of the deplorable working conditions in the textile industry, he said it is a big challenge to survive in textile units. If a person fails to mark their attendance for two consecutive days, then the staff — posted at the gate — would take away their employment card and bar them from entering the premises, he claimed.

Shahbaz Ahmed (name changed to protect his identity), a machine operator who worked as a daily wager, has a similar ordeal to report. He lost his job at an auto parts unit in Korangi Creek almost six months ago, where he was earning Rs20,000 a month coupled with paltry overtime. But after losing his job, he has nowhere to turn. “Two months back, I tried my luck by setting up a cabin of confectionery items at Korangi No.6, but I was robbed twice,” Mr Ahmed disclosed.

According to him, he was taking care of a four-year-old daughter while three of his children have already passed away.

Living in a joint family with four married brothers in an 80 square-yard house in Korangi No. 3, he said, “I cannot explain how I am surviving this economic crunch, especially after the massive jump in prices of food items and utility bills.”

Seven million layoffs?

As if this was not enough, the market is buzzing with claims regarding layoffs of at least seven million workers employed in the textile sector, including the value-added textile exporters.

Value-Added Textile Exporters Patron Jawed Bilwani said the apathy shown by the government towards the flailing textile sector has aggravated the sufferings of millions of employees.

If the situation failed to improve, the industries will be compelled to shut down and sack at least seven million textile workers as 80 to 90 per cent of the workforce in the textile sector is working on daily wages and contracts. All these employments depend on a consistent stream of export orders, he added.

Speaking about the dearth of export orders, he said rising gas and utility charges, non-availability of gas besides a shortage of dollars and raw materials were playing havoc with textile production in the country.

“Foreign buyers prefer lifting low-priced items and that is why Pakistan is lagging behind exports in comparison with its regional competitors,” Mr Bilwani said. He said he was not hopeful about future orders either, as till now they were not up to expectations.

A textile exporter, who asked not to be named, carefully estimated that 150,000-200,000 people have definitely lost their livelihood during the ongoing economic crisis.

Pakistan Institute of Labor Education and Research (PILER) Executive Director Karmat Ali said a large number of people in the industry are fast losing their jobs and urged the government to form a strategy to address the rising unemployment. The textile sector holds a 60pc share of the country’s total job outlook, he added. Mr Karmat said the majority of people working in the textile sector are not on a permanent basis, as most of the jobs have been outsourced by the companies.

Auto sector

Pakistan Association of Automotive Parts & Accessories Manu­facturers Senior Vice Chairman Usman Aslam Malik said at least 250,000-300,000 workers have been laid off due to a persistent drop in sales of vehicles.

Millat Tractors Limited Executive Director Sohail Bashir Rana said around 2,000 workers were affected owing to a decline in the sale of tractors over the last six months. Mashood Ali Khan, who exports auto parts, blamed economic uncertainty and dwindling sales of vehicles for the spike in unemployment. He said there was a need to control overhead expenses and the soaring cost of raw materials to handle the crisis-like scenario.

The only way forward to save the industries and jobs is the establishment of the National Economic Development Plan after developing a consensus among stakeholders, particularly political parties and industrialists. The former president of the Employers Federation of Pakistan (EFP), Ismail Suttur, said the business in the textile sector has gone down by 50pc since June last year.

“This is just the beginning. If this government continues with its policies, I fear the day when these retrenchments will hit the services sector and will prove disastrous for the breadwinners of Pakistan,” Mr Suttur said.

“If we do not act now, every passing week would push Pakistan further down,” he feared.

Published in Dawn, January 31st, 2023

Automakers suspend production

Aamir Shafaat Khan Published February 1, 2023 

KARACHI: Faced with a demand slump and raw material shortages amid unfavourable economic conditions, Indus Motor Company (IMC) on Tuesday annou­nced a fourth production suspension from Feb 1-14.

Also, Agriauto Indus­tries Ltd (AIL), an auto vendor, announced a partial closure this month due to a sharp decline in demand for parts and accessories from major automakers.

The assembler of Toyota vehicles in a stock filing said it would resume production from Feb 15 on a single shift basis until further notice.

IMC said the State Bank of Pakistan (SBP) on Jan 2 advised commercial banks to prioritise/facilitate imports to specified sectors only, which does not include the auto sector. This has disrupted the entire supply chain and the vendors are unable to supply raw materials and components to the company, IMC said.

The company had kept its production operation suspended from Aug 1-13, Sept 1-16 and Dec 20-30, 2022.

Despite production stoppages and a 52pc drop in sales in IHFY23, IMC shocked its customers by raising prices from Rs280,000 to Rs1.2 million on various models in the second week of this month.

Lucky jacks up prices: Kia Lucky Motor Corporation has raised the price by Rs100,000 to Rs1.3m from Feb 1. Till last month, the company has been offering a price lock option to the customers with immediate delivery.

As per the company’s website, the new price of Kia Picanto Manual and Automatic will be Rs3.2m and Rs3.4m, a rise of Rs100,000 and Rs200,000 respectively.

Bike gets costlier: The country’s no.1 bike assembler, Atlas Honda Ltd (AHL), has raised the price of 70cc-150cc bikes by Rs7,400-30,000 from Feb 1. The new rates of CD-70, CD-70 Dream, Pridor, CG-125, CG125S, CB125F, CB150F and CB150F (Silver) are Rs128,900, Rs137,900, Rs170,900, Rs194,900, Rs230,900, Rs305,900, Rs383,900 and Rs387,900.

United Auto Industries, the country’s second-largest bike assembler, has announced a price hike of Rs6,000-10,000 in 70cc-125cc bikes from Feb 1.

Memon Motor Private Ltd, assembler of Super Star Motorcycle, has raised the price of 70cc-125cc bikes by Rs6,000 from Jan 30. NJ Auto Industries, maker of Super Power bikes, has made a price jump of Rs5,000-8,000 in 70cc-200cc bikes from Jan 27.

Published in Dawn, February 1st, 2023