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Pakistan Awarded Bigger Apparel Quotas

President Bush has granted Pakistan a significant increase in its apparel quotas in recognition of Pakistans support of the U.S. anti-terrorist campaign. Following a meeting with Pakistani President Musharraf on February 13, Bush said Pakistan has been a "key partner" in Operation Enduring Freedom, and he promised that the U.S. and Pakistan will continue to strengthen their trade and other economic ties. The U.S. textile industry strongly criticized the granting of additional quotas to Pakistan, charging it was an "unwarranted concession at the expense of U.S. textile production and jobs." A fact sheet issued by the American Textile Manufacturers Institute (ATMI) said that Pakistans exports to the United States have not been adversely affected by the conflict in Afghanistan. It says that textile and apparel imports from Pakistan have increased by 7.2 percent since September 11 while imports from all sources are down 6.1percent. President Bush agreed to offer Pakistan $142 million in additional "market access" in order to help offset some of the problems the Pakistani industry and U.S. importers say Pakistan has been experiencing as a result of the war in Afghanistan. As the war continued, many U.S. retailers and other importers cut back or canceled orders for Pakistani goods, because of what they felt was uncertainty about deliveries from the war zone.Under the agreement, Pakistan will be granted additional quota in about a dozen apparel categories, including blouses, knit shirts, trousers, outer coats, underwear and gloves. Because Pakistans quotas automatically increase by about 11percent per year, the three year total of the increases will amount to more than $480 million. The U.S. Association of Importers of Textiles and Apparel, which has been deeply concerned about the disruption of trade from Pakistan, had sought considerably more in terms of liberalized quotas. USITAs vice president for international and government relations, Julie K. Hughes, says the impact of the increases will be "relatively minor" in the overall trade picture and the administration can justifiably say the action will not hurt the domestic industry.