KARACHI, July 7: Leaders of textile industry in both India and Pakistan are desperately seeking their respective governments’ interventions to help them rid of the stress they are encountering now, and are placing before their governments an utterly bleak employment scenario if no assistance is given to them.

As Pakistan textile business plans for a token shutdown on Friday to protest against gas price hike and also withdrawal of cash subsidy, well-placed sources inform that a high- powered committee of ministers and top bureaucrats is meeting on Tuesday at the petroleum and natural resources ministry to consider the situation arising out of the impact of Oil and Gas Regulatory Authority’s decision to increase tariff on gas for captive power plants by 68 per cent and on industrial consumption by 31 per cent.

An independent survey, carried out about three years ago, has assessed that gas tariff is 17 per cent of total production cost in textiles. On an average, the increase in gas price will push up production cost on fabric by one rupee per metre. The cost will be higher if cloth is heavy and will be relatively less if it is light in weight.

The same sources informed that another committee of several ministers and top bureaucrats is meeting on Thursday to decide whether to continue cash subsidy in the name of research and development or work out an alternative arrangement of giving cash subsidy to textiles on export. Textile industry leaders have warned of massive unemployment and a big drop in foreign exchange earnings if government fails to intervene to save their businesses from what they fear “complete collapse.”

Indian textile leaders, too, are bitter on “disappearance’’ of raw material (cotton) from the market for which they are blaming “international speculative traders’’ and want Indian government to ban export of cotton from India and allow duty-free import of cotton in India.

“Almost half a million jobs in textile industry have already been lost,’’ said Mr P D Patodia, Chairman, Confederation of Indian Textile Associations, at a press conference last week.

A website report says that Indian textile leaders met Indian union commerce, finance and textile minister and are now waiting for a meeting with the Indian prime minister.

Indian textile industry has been given a target of $22 billion which the textile business leaders find hard to meet. The textile industry is expected to invest Rs790 billion under a textile upgradation fund scheme. The industry has been given a target to push up exports to Rs50 billion by the year 2010.

Depreciation of rupee value in India and Pakistan has come as a temporary relief to textile exporters of both the countries. In Pakistan, dollar is now worth over Rs70 and in India it is about Rs43.

“What’s the harm in giving a few billions of rupees more to earn 12 billion dollars in the year 2008-09,” argued a top textile exporter.

Textile business in Pakistan is now sharply divided on cash subsidy issue. A proposal of subsidy assistance is said to have been moved on behalf of big businesses which stipulate benefits for those who give better export performance.

“This scheme benefits hardly a dozen exporters whose yearly performance is more than 100 million dollars,” said an apparel association leader who fears total elimination of small exporters from the field.

The three apparel manufacturers and exporters associations have announced to form an apparel forum and declared that they are the biggest stake-holders in textile export and no subsidy scheme without their support would be accepted.

While textile leaders want cash subsidy and relief on gas prices, the government leaders in private their conversations express inability to provide any help.

“There are no resources to offer relief on gas prices or to give cash subsidy,” a business leader quoted federal finance minister Naveed Qamar who said the textile industry can be helped by way of deficit financing which means more burden on invisible taxation on the people.