LAHORE: To remain competitive in the international market, Pakistani carpet exporters should keep pace with the changing trends by adopting latest technology, said Mian Attiq-ur-Rehman, chief executive officer of Pak Shalimar Carpets, one of the leading handmade carpet exporters of the country.

“The global trend is changing. Machine-made carpets are now in huge demand. High-tech machine weaves are as good as knots made by an artisan. The government should facilitate exporters in shifting from hand-knotted to machine-weaved carpets. It should establish a carpet city and provide easy loans for the import of required machinery and raw material,” he said, while talking to BOL News.

In the late 90s, Pakistan’s total exports of handmade carpets were $350 million, while it was $100 million from India. Now Pakistan is exporting carpets worth around $55 to $60 million, whereas India has become a top carpet exporting country in the world. Turkey is also far ahead of Pakistan in carpet exports.

“Turkey has made progress by leaps and bounds. It set up a carpet city and facilitated import of machinery for the industry around three decades ago. Shifting from hand-knotted to machine-made carpets has helped the country yield desired results. Now, the carpet exports from Turkey stood at $1.56 billion,” Mian Attiq-ur-Rehman said, adding that Pakistan needs to follow Turkey’s model for earning the much-needed foreign exchange through carpet exports.

Attiq-ur-Rehman is a graduate of the University of Punjab and a business management degree holder from the Career Business College, Sydney, Australia.

This successful businessman has taken this business, inherited from his father, to new heights through innovative marketing practices and hard work.

Pak Shalimar Carpets is now a multi-million-dollar enterprise, exporting a variety of carpets to the US, Australia, New Zealand and South Africa.

A humble and down-to-earth man, Attiq-ur-Rehman is committed to passing on a much bigger empire to his only son presently working with the Bank of Montreal. He is always ready to help the needy. He usually gives donations for the medical treatment of deserving patients.

Having an interest in business politics, Attiq-ur-Rehman is an executive committee member of the Lahore Chamber of Commerce and Industry. He has also served as the Pakistan Carpet Manufacturers and Exporters Association (PCMEA) vice chairman.

Following are the excerpts of an informal chat with him.

What was your first business venture?

After completing my matriculation in 1986, I started spending time in the office to assist my father. It was a good learning experience. Later, during my stay in Australia for studies, I used to spend spare time marketing our products. I played an active role in increasing our carpet exports to Australia.

What do you suggest to resolve the problems being faced by the carpet industry?

Carpet is the worst performing area of the textile sector. The overall textile exports are increasing but the situation is entirely opposite in the carpet subsector. The textile sector is entitled to subsidised gas, power and export finance. But carpets do not consume much power or gas. As such most of the facilities for the textile sector are meaningless for the carpet exporters.

There is a need to recognise carpet as an industry and give facilities according to its own requirements. The government should set up a carpet city and provide land to the exporters on easy installments. It should help the exporters get easy loans from banks for the import of required machinery.

What measures are needed to enhance carpet exports?

The sales tax exemption on unfinished carpets can double the export of the finished products within a couple of years. The government should treat unfinished/unwashed carpets imported from Afghanistan as raw materials. We can earn huge foreign exchange by exporting finished carpets to the developed countries.

How can we bridge the trade deficit?

There is a need to take short- and long-term measures for bridging the ever-widening trade deficit. The government should put an end to the unnecessary import of luxury items such as cars and take measures to reduce the input cost of the export-oriented industries. Diversification of products with due attention to engineering, IT and export sectors, value addition and exploring new export destinations are the need of the hour. There is a need to encourage industrialisation for increasing exports of the country in the long run.

Has the rupee depreciation helped increase exports?

I don’t think so. Actually, it caused a negative impact, as most of the export-oriented industries rely on imported raw material. The rupee depreciation, global inflation and higher freight charges has enhanced the landing cost of imported raw material. High input cost has made our products uncompetitive in the global market.

What is your take on an increase in markup rate?

Most of the Small and Medium Enterprises and cottage industry rely on short-term loans for managing day-to-day affairs. Enhanced cost of borrowings has made it difficult for the cash-strapped enterprises to make both ends meet. There is a need to decrease the markup rate and bring it at par with the regional countries to provide some fiscal space to the SMEs and cottage industry.

How inflation has impacted businesses?

Inflation is a global phenomenon that has negatively impacted businesses. The situation is really alarming for the industries relying on imported raw materials. Carpet industry heavily relies on imported wool for manufacturing thread. The quality of wool varies from region to region. Our wool is not of good quality for a product such as carpets. Usually, 70 to 80 per cent wool imported from Saudi Arabia, Iraq or New Zealand is mixed with the local raw material for manufacturing quality thread.

Inflation and high freight charges in the post-Covid-19 scenario has considerably increased the landing cost of the imported wool.

What is your suggestion to improve the business environment?

Though the business environment is not conducive for the existing players, it is extremely tough for the new entrants.

The new entrants should be given proper guidance through one-window facility and tax exemptions. I believe that the government must do something to club taxes and minimise the interference of departments for the existing players. It should also take measures to stabilise the exchange rate, reduce the interest rate and bring ease in doing business.

What is the future outlook of the overall business environment in Pakistan?

I am optimistic about the future of business owing to enormous potential. The government should take practical steps to ensure an enabling atmosphere for the new entrants and the existing players. The SMEs and cottage industries should be supported, as these are always the backbone of any economy.

What inspires you to join business politics?

Politics is in my blood. An active member of the Founders Group, my father has served as an Executive Committee member of the Lahore Chamber. I desired to make my experience and expertise productive by playing the role of a bridge between the policymakers, executors and the business community.