U.S. Textile Group Opposes Pakistani Garment Tax Free Promotion

Business News Agency, September 14 – U.S. textile and cotton industry groups have raised strong concerns over a proposed trade relief initiative aimed at assisting Pakistan in the aftermath of devastating floods. These organizations argue that instead of offering preferential trade terms to Pakistan, the U.S. government should prioritize delivering humanitarian aid to the affected regions. The U.S. Chamber of Commerce has urged the Pakistani government—currently dealing with widespread destruction from the floods—to request that the U.S. grant duty-free access for certain textile and garment products. This proposal, however, has drawn sharp criticism from key industry groups, including the National Association of Textile Organizations, the National Cotton Council, and AMTAC. These groups have written to Secretary of State Hillary Clinton and U.S. Trade Representative Michael Froman, expressing their deep concerns. Opposition leaders warn that the plan would shift American jobs overseas, potentially harming over 400,000 workers in the U.S. textile and apparel sector. Amita Tantillo, executive director of AMTAC, emphasized that the U.S. should focus on sending disaster relief supplies like tents, blankets, and medical equipment to Pakistan, which would not only support the country but also create employment opportunities for Americans. The U.S. Chamber of Commerce is advocating for an extension of the existing “Regional Opportunity Zones” (ROZs) along the Pakistan-Afghanistan border, allowing specific clothing items such as cotton pants and shirts to be imported duty-free into the U.S. They also propose expanding the zones where Pakistan can establish ROZs. Despite the Chamber’s claim that this initiative would not harm U.S. manufacturers, critics argue that garments made with U.S.-sourced yarn and fabric are highly sensitive export items for companies in the Western Hemisphere. Additionally, opposition groups have criticized the proposal for undermining the Obama administration’s National Export Initiative (NEI), which aims to double U.S. exports within five years. The idea of shifting jobs overseas contradicts this goal. In response to the Chamber’s proposal, some analysts note that granting Pakistan tax-free access could directly compete with garment producers in Mexico, Central America, and the Caribbean, putting American manufacturers at risk. The letter also highlights how the Chamber’s approach undermines another key administration priority: the Haiti Economic Lift Program Act (HELP), passed in 2010. This is because Haiti competes directly with Pakistan in supplying garments to the U.S. market, making the proposal even more controversial. With ongoing debates about trade policy and economic priorities, the issue remains a hot topic among U.S. business leaders and policymakers alike.