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Public Disclosure AuthorizedSOUTH ASIAPublic Disclosure AuthorizedPublic Disclosure AuthorizedPublic Disclosure AuthorizedNEIGHBOURSADVANCING REGIONAL INTEGRATION, COOPERATIONAND ENGAGEMENT IN SOUTH ASIAFine cotton and designer fashion: ConnectingPakistani exporters to Indian marketsBy Samavia Batool & Vaqar Ahmed#OneSouthAsiaCASE STUDY 4, 2021The news story headline, ‘India goes nutsand2015,chambersofover Pakistani textile products,’ captures theand textile ministries on both sides ofexcitement of Indian customers in 2012 whenthe border organized trade fairs at leastgiven direct access to Pakistani apparel attwice a year to connect fashion designers,a trade exhibition in New Delhi. Pakistan'sclothingfamous lawn cotton became a quick hit withdistributors, and retailers. Pakistan andIndian women who scooped up apparelnorthern India share similarities in culturalmade with original patterns, fresh designs andtraditions, norms, and climate – and fashionsoft quality.tastes. Hence, the trade relationship is amanufacturers,commerceexporters,natural one.The successful trade show marked a briefbut important softening in Pakistan-IndiaDespitesoaringtrade relations. It was soon followed byexports of clothing to India became moreshipments of Pakistani fabrics and designerandgarments to Indian cities. Between 2012increased and business visas ine cotton and designer fashion: Connecting Pakistani exporters to Indian markets1
#OneSouthAsiaSOUTH ASIAharder to obtain. Trade fairs are now heldAs the trade relationship flourished, PFDCin third countries such as Turkey and Dubaioffered display space in its Lahore andto keep a connection between PakistaniKarachi shops to the Fashion Design Council ofexportersalive.India, a not-for-profit organization promotingonlinethe fashion design industry in India. In 2014,channels and courier services to cater toIndia-based Rubaaiyat launched its ownindividual Indian customers. Others countstore in Lahore. Even before the exhibition,on the Indian diaspora to carry the latestPakistan’s exports of clothing to India werestyles in their suitcases during trips home.on the rise. For a decade beginning in 2005,In women’s fashion, political rivalries fallapparel shipments rose annually by moreby the wayside as buyers and sellers focusthan 20 percent, according to fashionon rich fabrics, elegant designs, andindustry experts. Major Pakistani fashioninnovative styles.brands rushed to claim space in the arket. Smaller suppliers in Pakistan sellingreplicas of high-end lawn brands also beganto establish their mark in Indian apparelPakistani fashion isa natural fit in Indianwardrobesmarket. Trade fairs and other events gavePakistani exporters direct access to Indianapparel distributors.The Lifestyle Pakistan trade show thatThe fashion trade was made possibledebuted in 2012 produced clear evidencewith the active support of Indian HighofimportsCommission in Islamabad and consulates inand exports. Pakistani designers saw anboth countries. Pakistani apparel businessesopportunity to use fashion to promotewere able to expand operations to NewculturalwereDelhi and designers were granted 6-montheager to respond to the pent-up customervisas to directly manage their sales indemand for Pakistani products. After theIndia, though most of these visas were city-exhibition,store,specific and restricted marketing activitiesPakistan’s Fashion Design Council or PFDC,planned for other Indian cities. Tradeopened a franchise in New Delhi as partofficials on both sides facilitated business-of the shop, Rubaaiyat, by Mini Bindra ofto-business meetings, and a memorandumBindra ssociations in India and Pakistan. The“We did not even have to doaccess provided to some businesses undermarketingthe South Asian Association for ductscakes.”–anapparel exporter from Pakistan2.2Cooperation(SAARC)visaexemptionregime was also helpful.BollywoodwearingstarswerePakistaniFine cotton and designer fashion: Connecting Pakistani exporters to Indian marketsphotographeddesignerlabels,
#OneSouthAsiaSOUTH ASIAincreasing demand for the apparel on bothAsian cities, giving businesses of all kindssides of the border. “Leading Bollywoodand policy makers a venue to discussactresses were contracted to promote ourregional economic cooperation.products across borders and it used to bea race, even in the domestic market, asFashion proved to be two-way street. Assoon as our lawn collection was launched.Pakistani exporters expanded shipments,I mean, who wouldn’t want to wear athey made frequent trips to India anddesign advertised by Karina Kapoor?” saiddeveloped links with distributors. Thosea Pakistani exporter of fashion knock-offs.distributors began exporting traditionalTelevision also boosted consumer demand.Indian garments such as sarees made fromIn 2014, India’s Zee Zindagi TV channelsix yards of fabric, Rajasthani dresses, andbegan broadcasting Pakistani dramas thatankle-length lehengas to Pakistan’s Punjabbecame a showcase for fashion trends.and Sindh provinces. Experts see muchmore trade potential between the twoThe fashion industry stitched up morenations, especially in items such as shalwarsales as part of a broader shift in relationskameez (trousers with a long tunic) andbetweenrichly embroidered bridal wear.thetwocountries.In2012,India and Pakistan agreed to ease strictvisa requirements, especially for small“There is a huge demand for Indianbusinesses, religious pilgrims, and tourists.lehengas in Pakistan, especiallyThe change meant Pakistani businessesduring the wedding season. Wecould get a multiple entry visa for onehad a two-way relationship withyear that would allow them to visit upour distributors in India. We used toto 10 Indian cities. During this time, thesend them Pakistani clothes and,India-Pakistan Joint Business Council andin turn, they used to sell us Indianthe Pakistan India Business Council wereclothes.” – a Pakistani exporterestablished to promote trade and staniexportsweretanks, and civil society groups advocatedproduced by women-owned businesses.investment cooperation and peace in theIndia’sregion. The momentum led to businessappareldialogues in Islamabad and throughoutfor existing companies, and attractedPakistan about creating and developingwomen entrepreneurs in urban centersvalue chains, and collaborating in energyof Pakistan.3 Even today, most membersand water sectors, among other things. Aof the Islamabad Women Chamber of2008 initiative created the successful SouthCommerce and Industry identify apparelAsia Economic Summit, co-hosted by aexports as either their sole or secondarygroup of think tanks. The annual ortunitiescontinues today and rotates among SouthFine cotton and designer fashion: Connecting Pakistani exporters to Indian markets3
#OneSouthAsiaSOUTH ASIACutting a new pattern forgarment salesvisitors after a militant attack near the townof Uri in Jammu and Kashmir.Since 2015, clothing exports from Pakistan“The last shipment I sent to Indiato India have declined significantly despitewas back in 2015. The last threestrong consumer demand.consignments were a total lossto me as I had to pay more intaxes and tariffs than the costPakistan Clothing and Textile exports (million 05806057.55,000014,1152010Pakistan's exports to the world20152018200Pakistan's exports to ahore.The period from 2009 to 2015 witnessedan increase in direct export of cotton suits(Harmonized System code – 620412) fromPakistan to India that peaked in 2015 atSource: UNCOMTRADE database (2019)USD 247,800 from USD 4,100 in 2009. SinceThe political vagaries of India-Pakistansupply of these Pakistan-made garmentsrelations along with a number of tariff andwas once again re-routed via Dubai;non-tariff barriers restrict access to theIndia imported USD 68,100 of cotton suitsIndian market. For example, some Pakistanivia the United Arab Emirates in 2019,shipments have customs clearance delaysjumpingof up to 45 days. A delay adds costsin 2018 .the India-Pakistan trade ban in 2019, thesignificantlyfromUSD3,6004and means seasonal garments – such aslightweight Pakistani lawn – fail to reachThethe final market on time. The main tradeambassador for Pakistani fashion. Pakistanroute for Pakistani shipments to India haspavilions at trade fairs mostly organized inbeen through the border crossing nearthe United Arab Emirates, Britain, and TurkeyLahore at Wagah, Pakistan. Attari, India,are filled with Indian retailers, importers, andlies on the other side of the border and iseven individuals willing to buy in bulk toabout 25 kilometers from Amritsar. Apparelobtain Pakistani apparel.Indiandiasporahasbecomeanexporters say the effective tariff (includingpara-tariffs) at that location is a steep 21The diaspora is also serving as a deliverypercent, leading to apparel trade viaserviceinformal routes.exporters send casual shalwar uits,SmallformalTrade has also been chilled by stricterwear, and hand-embroidered dresses tovisa rules that make it difficult for PakistaniIndia in the suitcases of Indian nationalsexporters and Indian distributors to meet. Inreturning home for a visit. Some exporters2016, India tightened visa rules for Pakistaniuse social media such as Facebook to4Fine cotton and designer fashion: Connecting Pakistani exporters to Indian markets
#OneSouthAsiaSOUTH ASIAIndian customers flockClothing and apparel are more thanto Facebook pages like ‘Pakistani Suits’6,just products. Pakistan and India share‘Pakistani Designer Suits’ , ‘Designer Lawna rich cultural history and many peopleSuits, among others to browse the latestin both countries use their wardrobePakistani fashions. Indian customers alsoto reflect historic values and traditions.use major online stores such as Flipkart,Political tensions and trade barriers haveAmazon, and Jabong whose vendors offernotinternational delivery for clothing orders,entering India, and vice versa. Fashionoften at a lower price than Dubai shops.designers and entrepreneurs have turnedPakistani businesses that sell productsto e-commerce, informal trade, and salesthrough foreign online stores could reducethrough third countries to meet consumertheir costs if Pakistan adopted more anddemand, though to a limited extent.accept orders5.78stoppedPakistaniproductsfrombetter online payment gateways and“I am a regular buyer of Pakistaniconsumer protections.9clothes in India and one of the ardsthePakistanbilateral relations will eventually improvetextile is their quality but givenand result in lower tariffs for apparel exportscold relations between the twoand lower import taxes in India. Demandneighboringfor Pakistani apparel in the Indian marketdresses have now become prizedremains encouraging.possessions of an Indian iinDelhi.Fine cotton and designer fashion: Connecting Pakistani exporters to Indian markets5
/.2.Given the sensitive bilateral relationship between Indiaand Pakistan, most of the interviewees spoke on thecondition of anonymity.3.Yaseen, Fayyaz and Vaqar Ahmed (2016) Trade Windsof Change – Women Entrepreneurs on the Rise in SouthAsia: Background Country Study for Pakistan. UnitedNations Development Programme.4.Singla, Nikita. Arora, Priya. China Pakistan FTA-2: ANew Regional Hub for Cotton Garments in the Offing.Outlook. 2020. cotton-garments-in-the-offing/348942.5.Richardson, Mark; Tsui, Josephine; Nazir, Ahad; Ahmed,Vaqar. 2017. Activist to Entrepreneur: The Role ofSocial Enterprise in Supporting Women's Empowermentin Pakistan. Sustainable Development Policy ttps://www.facebook.com/brandedlawnshop/9.Ahmed Qadir and Vaqar Ahmed (2019) E-commerceregulations in Pakistan. Trade Insight Vol. 15, No. 1-2, 2019.Picture credits: The World Bank ImagesNeighbours SeriesA key objective of the World Bank’s South Asia Regional Integration, Cooperation and Engagement(RICE) approach is broadening evidence-based communication and outreach activities that willhelp strengthen the case for RICE and generate domestic demand. The ‘Good Neighbours’ seriesshowcases successful cross-border stories demonstrating regional cooperation to build support forregionalism in South Asia.Series EditorMandakini Kaul is Senior Regional Cooperation Officer, South Asia Regional Integration andEngagement at the World Bank.EditorNikita Singla is Consultant, South Asia Regional Cooperation at the World Bank and is AssociateDirector at New Delhi-based Bureau of Research on Industry and Economic Fundamentals.About the AuthorsSamavia Batool is a Senior Research Associate at Sustainable Development Policy Institute.She holds a MSc in Economics from Quaid-e-Azam University, Pakistan.Vaqar Ahmed is a former civil servant and currently Joint Executive Director, SustainableDevelopment Policy Institute.SOUTH ASIAAdvancing Regional Integration,Cooperation and Engagement in South AsiaThe World Bank1818 H Street, NWWashington, DC 20433Email: onesouthasia@worldbank.orgWebsite: www.worldbank.org/onesouthasia
dresses, unstitched lawn suits, formal wear, and hand-embroidered dresses to India in the suitcases of Indian nationals returning home for a visit. Some exporters use social media such as Facebook to SOUTH ASIA #OneSouthAsia Source: UNCOMTRADE database (2019) Pakistan Clothing and Textile exports (million USD) 47.4 2005 2010 2015 2018 0 20 40 .
Public Disclosure Authorized WPS4202 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized. 2 INTRODUCTION Small arms are estimated to be responsible for between 200,000 - 400,000 deaths around the world each year. Approximately 20,000 – 100,000 of these firearm deaths occur in conflict
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