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Pakistan Puts off 10 Million Strong Worker Strike

Pakistan’s garment sector workers and the associations that represent them had a strike scheduled for Friday to protest concerns over the country’s ailing textile industry, but a request by the finance minister succeeded at keeping the 10 million strikers at bay—for now.

Chairman of the All Pakistan Textile Mills Association (APTMA) S.M. Tanveer announced that the strike would be deferred for one month following an assurance from the finance minister that the sector’s wrongs would be righted by Aug. 31, according to Pakistan’s Dawn newspaper.

The country’s textile mills are struggling in the face of high costs, burdensome electricity surcharges—which can be upwards of 45 percent more than what the country’s regional competitors pay—enforcement of a gas infrastructure development tax and punitive taxation on export-oriented goods.

In making a comparison to Pakistan’s competitors, Tanveer said between 2009 and 2014 Pakistan only added one million spindles of cotton, whereas China added 35 million and Bangladesh, 1.9 million. And in the last five years, he added, China set up 300,000 looms, India 36,000, Bangladesh 22,000 and Pakistan set up just 1,319.

Conditions have been adverse enough to force many mills to close or prepare to do so, which would leave 15 million workers’ jobs at stake.

“Why textile industry should pay extra taxes to cover up inefficiencies of power sector, like theft, line losses and short recoveries,” Tanveer posed, adding that the government pays its circular debt by taking credit from banks and then passing it on to the textile industry after converting the interest into a surcharge, Dawn reported.

Resolving those issues is expected to save the sector 175 billion Pakistani rupees ($1.72 billion) annually.

But if the problems aren’t resolved, Tanveer said the strike will go on Sept. 4.