Parashar Kulkarni from CENTAD, India; in his presentation, Textiles Post-ATC: A South Asian Perspective , touched upon the issue of labor costs and how buyers overlook its significance as it is only a small percentage of total costs incurred. He argued that though labor costs have been given excessive importance in the debates on competitiveness among South Asian countries; the data he looked into contradicted this conception. He pointed out that when it comes to market share, for most South Asian countries the garment sector is more important than textiles. For buyers competitive pricing is the most important issue. To conclude, he pointed out that competitive advantages could be instantly changed through the application of tariffs, anti-dumping duties, free trade agreements (FTAs), rules of origin, and preferential trade schemes like the EU's Generalised System of Preferences (GSP).
Dr. Karin Astrid Siegmann from SDPI gave a presentation on Gendered Employment in Pakistan's TC Industry Post-Quota . Dr. Siegmann pointed out that TC is a heavy employment and female-intensive sector, with one-fifth of global manufacturing employment being female. In Pakistan, this industry is the largest formal employer of females. Developing countries have the advantage of cheap labor costs, but face increased competition especially from China in present times. However, she argued that trade liberalization had created employment for women due to their cheaper wages rates. She discussed the idea of skill polarization and findings of her recent research study conducted in Karachi and Faisalabad. Some of the central findings of her research study were that prices have dropped for all sectors, that overall employment rates and female employment rates have increased slightly (with significant sectoral variations), and that females have gained in productive employment while males have lost out. The change in the gender composition of employment could be explained by the relative cost efficiency of employing females – or rather: by the lower wages women workers can be paid. She concluded her presentation by questioning for how long the gender wage gap would provide a competitive advantage to women in the industry.
Ms. Foqia Sadiq Khan from the School of Oriental and African Studies (SOAS), U.K, in her paper, Human Resource Issues in Textiles and Clothing Sector of Pakistan: Would the ATC expiry make a difference?, presented results from her field work which focused on human resource issues in the industry, exploring the lack of skilled labor, and possible efforts to improve this situation. She argued that to date the lack of skilled labor had not effected Pakistan's competitiveness adversely; however, the garment sector which requires a higher degree of skilled structure remains the most neglected sector. She stated that her interviewees mentioned lack of skilled labor and quality training institutes as a major problem, which she attributed to governments allocating little funds for education in its budget. She highlighted that the textile industry did not explore solutions, nor sufficiently lobbied the government to address the shortage. In conclusion she analyzed Pakistan's capitalist class in terms of Marx's concept of “primitive accumulation”, asking why it had not sought skill development.
Ms. Alessandra Mezzadri from the School of Oriental and African Studies (SOAS),UK, in her presentation on Limitations of Corporate Social Responsibility in the Indian Garment Sector: A Case Study from Delhi Industrial Area highlighted how local issues intersect with global pressures, and there is a need for effective monitoring in the industry. The key point of her presentation was that globalization did not introduce new and more egalitarian social structures, but rather manipulated existing social structures in a predatory manner. Further, she suggested that in India's garment sector there is a positive perception of the quota expiry, which is leading to increases in unit size, along with a trend for greater consolidation of production in Delhi. However, casual labor persists which exacerbates poor work conditions and standards, as the codes for corporate social responsibility do not apply for temporary workers. Ms. Mezzadri also provided an overview of the geography of production and how this follows a logic of minimization of costs.
The session was chaired by Abrar Ahmad Khan, Joint Secretary of the Ministry of Commerce. The discussant Dr. Zubair Bandukda, Dean of the Textile Institute of Pakistan in his comments stated that it was important to distinguish between textiles and clothing in analysis, as well as a more thorough elaboration of what is meant by value addition, since often processing of material into garments actually reduces its value. He also said that education and training are different concepts, and the real issue is the lack of qualified middle management in Pakistan.
The discussion period saw some important points being debated. One participant responding to Ms. Sadiq Khan's presentation explained that the capitalist class consisted of former bureaucrats and military officers who lacked the ability to understand their position in the economy. This was then rebuked by other participants as a fallacy. The is sue of regional cooperation as a method to mitigate effects of the ATC expiry was also raised, to which Mr. Kulkarni responded that it would not work because of the rules of origin, and further would cause a loss of competitive advantage for individual countries. Dr. Siegmann responded to this by suggesting that since Mr. Kulkarni had pointed out the relative insignificance of labor costs in the industry, this should not present an obstacle to regional and global cooperation regarding minimum labor standards. Dr. Siegmann was asked why qualified female graduates were not offered middle management and higher positions, to which she responded that government support was required to stimulate a competitive environment in this job market. She suggested that companies were operating below potential by not hiring women, who performed better in business schools and were likely more qualified than their male counterparts.
Reported by Atif Nasim
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