As textile industry calculates, amid regrets, the total potential impact of recent imposition of 13.1% anti-dumping duty on bed linen by EU (European Union), the Pakistani exports to European countries are to receive another blow of being denied the benefit of GSP (Generalized Tariff Preference) concession by EU from January 01, 2005.

EU under Article 1, Clause (e) of Regulation (EC) No 2501/2001 of the Council of European Union had granted the GSP concession on imports from Pakistan from January 2002 to December 31, 2004. The Article 1 (e) provides EU with the authority to grant the concession to the most developing countries against "special arrangements to combat drug production and trafficking". Pakistan is to enjoy this exclusive benefit against its support to combat drug production and trafficking in Afghanistan, till December 31, 2004.

EU on strong protest lodged by India (which along with China - the two main competitors of Pakistan, not entitled to this concession) with WTO (World Trade Organization) has decided to withdraw GSP concession to Pakistan from January 1, 2005. This is considered another decision by EU and is set to add to the negative impact; the Pakistani exports have to face import duty anywhere between11.5 to 13.5% besides levy of 13.1% anti-dumping duty.

If EU had one good reason to extend GSP concession to Pakistan in 2001- 2004 against 'special arrangements to combat drug production and trafficking', it has more than one reason to allow this concession to continue beyond December 31,2004. Decision itself negates very spirit of clause (e) of the Article 1 that provides EU with authority of extending the concession to a most developing country against its support to combating of drugs. Can EU quote any other country go to that extent as Pakistan to contain poppy traffic of Afghanistan?.

Admittedly, Afghanistan is the source for about one-third of world opium (the core ingredient of drugs preparation) production and trafficking. Despite immense efforts by the world neither opium production nor drug trafficking is brought under control. Non-availability of any alternate source of income in this war-torn country where industry or business cannot flourish, opium poppy harvest has traditionally been main source for livelihood for people and major single contributor in the country's GDP. This also helps warlords to serve their ammunition and arms purchase bills.

aliban regime is the only era that brought opium production and trafficking drastically lower, a fact admitted by United Nations Office on Drugs and Crime.

As per UN Agency statistics, opium poppy cultivation was controlled in Taliban regime (from 2001onwards) to 8000 hectares land, from an annual average harvest over 70,000 hectares land since 1994. EU decision tantamount to violation of its own law (Article 1 Clause e) that provides efforts against drugs trafficking with the assistance through this GSP concession. It also leaves doubts whether the Union will withdraw its support to the efforts to control opium poppy production in Afghanistan, which since the demise of Taliban regime is, alarmingly, on rise.

Findings of the annual Afghanistan Opium Survey 2003, conducted by UN Office on Drugs and Crime (first time in collaboration with Afghan government) revealed that Afghanistan has again become the world's one-third opium poppy production source with total harvest on over 80,000 hectares land in 2003. This contributed about $ 2.5 billion, half of total GDP of the Country in the year.

Curtailing of concession to Pakistan at this moment by EU will not only demoralize the current drug control efforts but also discourage future plans and measures in this regard. The only way out is that EU should continue to supplement efforts towards combating drugs production and trafficking through GSP concession, which the Union is authorized to and has not been going out of way to do an extra favour to Pakistan. Pakistan since being frontline state and itself victim of drug trafficking deserves this concession. EU also realize this while extending the concession to Pakistan since no other countries in the row is directly affected from mass opium poppy cultivation in Afghanistan.

There is also no justification to curtail this concession when the opium poppy cultivation is on rise in Afghanistan (as per survey). The time when the cultivation is completely eroded or brought atleast to the level Taliban regime achieved, it might find EU appropriate to reconsider continuation of GSP .

Its three types support in the international community's drive against terrorism is another genuine reason that entitles Pakistan to the GSP concession. Very careful estimates show that Pakistan economy suffered a loss of about $ 10 billion as a result of 9/11 and its support to international forces in Afghanistan war. This is in addition to the internal political turmoil and resistance it faced within the state. Pakistan offered support in term of logistics, exchange of intelligence information and airspace to US and allies in the operation against alleged terrorists in Afghanistan.

Pakistan so far secured a paltry contribution of $ 1 billion hard cash assistance from US, with commitment of $ 3 billion more in next three years and 15% concessionary quota by EU. This support is too meager to bridge total impact of the support the national economy met.

Even a greater contribution of Pakistan is fighting against terrorists and being a strong ally of the United States and also engaged its forces to capture terrorists in tribal areas and Afghanistan and chase Osama Bin Laden and other members of Al-Qaida group. Pakistan has taken strong steps in tribal areas where no other government has succeeded in the past three years to control tribal territory. Even British failed to control tribal areas for 300 years during their rule.

This has resulted in resentment among tribal people against the most prestigious institution - Pakistan army. The loss of precious lives is in addition. EU should realize and the world community should exert its influence that it is only Pakistan, which could go to that extent in its stand to support the US in war against terrorism. And Pakistan, being frontline state, should be compensated against the losses inflicted to its economy and national harmony. It does not make point here to EU to end the already extended support in term of GSP benefit, instead of offering more.

After 2005 Pakistan is going to face creativity crisis and its exports are likely to be dropped because of the competition from far developed export regimes of India and China and highly protected LDCs who have ever rising productivity and quantity compatible to developing countries . The situation will be rather critical if one looks at some forecasts for the geo-political situation of the region where Pakistan is a focal point. The country is enjoying continuation EU support in the form of GSP benefit and maintaining its export level and providing employment and working for eradication of poverty. EU decision to withdraw GSP concession with effect from January 2005 will drastically affect Pakistan's progress and drop of export. It will be in the fitness of things that the decision is revised without Pakistan being in the same category to be at par, shall not hamper fast moving development of India and China.