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EU Grants Duty Free Status to Pakistani Goods

The European Union has temporarily relaxed rules on Pakistani duty free imports, in a bid to help the nation recover from the devastating flooding of 2010.

The measure includes fabrics, garments, linen, ethanol, and leather, and will extend to the end of 2013. If the imports of textiles or garments grow more than 25% during the course of the legislation, the EU reverses the right to reinforce duties in order to protect sensitive industries.

Overall, 75 goods are included in the duty free scheme. The legislation comes at a critical time for Pakistan, which is struggling with an inadequate supply of electricity and gas. It was recently announced that the gas supply to the garment sector would be prioritized, but the government almost immediately followed by announcing that the sector would only be receiving gas four days a week.

The contradictory status of governance in Pakistan has created turmoil within the garment and textile industry. It has led some industrialists to move capital out of the nation, and has caused a drop in orders and exports.