The US COngress is working on a Reconstruction Opportunity Zone (ROZ) Bill. However the proposal for the bill leaves out pants and shirts on the export list. If the Obama Administration is serious about helping the people of the war zone it should sign a Free Trade Agreement (FTA) with Pakistan.   The USA is spending trillions of Dollars on wars. An FTA and access for Pakistani textile goods to America would not be aid, or help. It would be an opportunity for Pakistani farmers to sell goods in markets they did not have access to.

• Will Reconstruction Opportunity Zones (ROZ) make a difference in Pakistan?
• PEANUTS: Puny US Aid to Pakistan is too little too late. Marshall Plan, & Trade concessions missing

Secretive U.S. efforts to pump millions of aid dollars into northwest Pakistan and dry up support for the Taliban and al-Qaida have barely begun because of attacks on development workers, fears of corruption and dragging bureaucracy. ISLAMABAD (Map, News) – A major U.S. effort to erode support for the Taliban and al-Qaida by pumping millions of aid dollars into the violence-wracked Afghan border region is being threatened by attacks on aid workers, corruption and layers of bureaucracy.

The Obama administration has pledged to use development aid as a foreign policy tool, and is expected to unveil a new hike in assistance before April. But there are concerns about how the money is being spent in remote valleys too dangerous for foreign aid workers to venture and where residents risk a beheading if they cross the militants.

A new Obama administration trade measure, intended to provide jobs in Pakistan as an alternative to the lure of Islamic extremism, could mean little because of protectionist language approved in the House of Representatives, according to American retailers and Pakistani manufacturers.

ROZ Pakistani map

The “Reconstruction Opportunity Zones” legislation, which is now before the Senate, allows for duty-free export of textiles to the U.S. from militancy-plagued northwest Pakistan, but it specifically excluded cotton trousers and shirts and other popular clothing items.

The administration strongly supports the zones, which if successful, could generate employment and help quell the terrorist threats to the U.S. and its forces fighting the Taliban-al-Qaida insurgency in neighboring Afghanistan.

The designation of  parts of Pakistan as ROZ (Reconstruction Opportunity Zones) is a first initial step that is a move in the right direction. We have always advocated a Marshall Plan for Pakistan. This is the only way to supress the insurgency and reverse Anti-Americanism in the region. The US has wasted $143 Billion in Afghanistan and not achieved any gains. We have over the years advocated a Pakistan FTA with the USA that would allow about $15 Billion of exports to America. This hard earned money would belong to the Textile exporters who would have to build extra capacity and hire more workers. The new employees would become more integrated into the society, and would send their children to the best schools in their vicinity would would graduate and perhaps go to the USA and Europe. These would bring back education and moderation to the people similar to what has happened in Malaysia and Korea.

“If this (bill) was amended, it could really turn things around,” said Afan Aziz, the chairman of the Northwest Frontier Province wing of the All Pakistan Textile Mills Association. “It could, we estimate, provide employment for 700,000 to 800,000 people, and think of all the families that would support. Then, no one would want to turn to the gun.”

Richard Holbrooke, U.S. special envoy for the region, said the last month the aim of the bill is to rebuild the lives of refugees displaced by the Pakistan army’s clashes with local Taliban insurgents and al-Qaida. “An opportunity for them to have this kind of chance through this bill is all the more important,” Holbrooke said.

On the other side of the debate are U.S. textile manufacturers, who said that any easing of the restrictions approved by the House last month will threaten American workers in a sector that’s already lost tens of thousands of jobs.

Lloyd Wood, a spokesman for American Manufacturing Trade Action Coalition, which represents the textile industry, described the attempt to expand the zones plan as a “windfall” for importers and retailers.

“If the importers don’t have to pay the duty, that money is going to go right into their pockets. They won’t pass that money on to the consumers, and they certainly won’t pass that money to Pakistani workers,” Wood said.

Pakistan has been struggling to get a Free Trade Agreement (FTA) with the USA. She has also been asking America free access for her Textiles to the USA. On both counts, there was a “penny-wise-pound-foolish” “No bid“.

Although Pakistan has been a leading partner of the US in the war against terrorism, in terms of trade in goods and services Pakistan falls fairly low in the list of US trade partners. The share of exports from Pakistan to the US market remained stagnant at around 0.21 per cent during the past four years. Dawn

Just imagine if the USA had agreed to the FTA and the free access of Textiles, this would have transferred more than $6 Billion per annum to the cotton producing areas of Pakistan. $42 Billion plus increased export of other commodities would have created new opportunities for the farmers. They would have sent their kids to the best schools in Pakistan and America–not to madarssas. Thomas Freidman of the New York Times suggested opening up American markets for Pakistan products this in 2001!

The cumulative affect of $40-$100 Billion would have totally transformed the entire infrastructure of the country because the money would have gone directly to the farmers without any leakage into kleptomaniac hands of government officials.

However it is now seven years later, and neither the FTA, nor the access for textiles materialized. There is still time! This could start in 2008.

When President Bush stopped over in Pakistan after his visit to India, he promised Pakistan the creation of Reconstruction Opportunity Zones (ROZ)–areas that could export products to the USA without any duty.

Later all of Afghanistan was added a a ROZ. Pakistan tried to get all of the NWFP and Baluchistan as ROZ, but it got approval for only the border areas. The districts identified for the establishment of ROZs included: Punjab: Bahawalpur, D.G. Khan, Jhang and Muzafargarh; Sindh: Badin, Jacobabad, Khairpur, Sanghar, Tharparkar and Thatta; NWFP: Bunir, D.I. Khan, Hangu, Lower Dir, Swat and Upper Dir; Balochistan: Gwadar, Kalat, Kharan, Sibi and South Waziristan

The bill in question, the Pakistan Enduring Assistance and Cooperation Enhancement Act of 2009, was introduced to support the nuclear-armed U.S. ally, which is struggling against an al-Qaida and Taliban insurgency, and trying to avert economic collapse.

Pakistan’s Northwest Frontier Province and tribal area, a strip of land sandwiched between the province and Afghanistan that’s provided sanctuary to anti-Afghan and anti-Pakistani insurgents, have borne the brunt of the violence and would benefit most from the reconstruction zones. While the U.S. is promising to triple civilian aid to Pakistan to $1.5 billion a year, the zones are an attempt to allow the country to trade its way out of trouble.

“This is a war-affected area. If industry is not installed, unemployment not removed, then the ‘war on terror’ cannot be won,” said Ilyas Bilour, a member of Pakistan’s parliament from the NWFP. “People have to eat.”

A representative for Sen. Maria Cantwell, D-Wash., a Senate sponsor, said details of the legislation are still under discussion and should become clear by mid-July.

Pakistan supplies about 3 percent of U.S. imports of clothing and other textile products, or $3.1 billion out of $93 billion in 2008, according to the Commerce Department.

Pakistan’s textile industry is concentrated in the economically dominant Punjab province in the east. Allowing duty-free exports from the North West Frontier Province could provide an economic boost in the region. Total industrial employment in NWFP is no more than 1.5 million, out of an estimated population of 21 million, according to the All Pakistan Textile Mills Association.

Pakistan’s new provinces. Ending majoritarianism. Balancing the federation. Empowering minorities. Resolving greviences 

The area under ROZ should be dramatically increased to include all of Pakistan. The US should build 1000 hospitals and 5000 schools and 100 new American Universities which would cost less than the bombs that are thrown at the FATA residents. The hospitals would be a living symbol of good American intentions and the Universities and Schools will create moderate and literate Pakistanis. The American University in Beirut is an example how one campus can make the difference in the entire region.

While the UEA can purchase campuses from the West, Pakistani students could be offered scholarships to attend the modern American campuses in Dubai and the Guld States. The educated Pakitanis would build shops and businesses in Pakistan that would generate wealth and moderation.

A coalition of U.S. retailers including Wal-Mart, the U.S. Chamber of Commerce and brands such as Levi Strauss wrote the Senate Finance Committee on June 22 pleading for more mainstream clothing products to be included in the opportunity zones and for duty-free status to apply across all of Pakistan.

“We strongly urge that the Senate … expand and revise it in several areas to ensure that the ROZ program is not a hollow gesture,” the letter said. “As currently drafted in both the House and the Senate, however, the ROZ program represents only symbolic assistance.”

The bill excludes top-selling products such as cotton trousers and shorts and cotton knit tops, items on which the U.S. currently levies a 15 percent to 25 percent import duty, but it allows less popular and less profitable items such as cotton dressing gowns and silk underwear.

The legislation also includes labor standards and monitoring requirements that are “highly onerous,” according to the letter’s signers. That includes international labor conventions that the U.S. hasn’t ratified, such as the right to organize a union and the elimination of discrimination in employment.

“Right now, this program is too limited region and product-wise, with enough red tape to make it useless. With its offsetting tariffs, it may actually do more harm than good. It’s not a serious response to the crisis in Pakistan,” said Rep. Ed Royce, R.-Calif.

According to American textile manufacturers and unions, the labor rules in the legislation are needed to protect U.S. jobs and guard against practices such as child labor.

David Trumbull of the National Textile Association said its members could live with the House-approved plan but that attempts to widen its scope would put the whole idea in “jeopardy.”

Sen. Kit Bond, R-Mo., told McClatchy Newspapers that the threat to American jobs had to be weighed against a greater menace. “Continuing to ignore the pull of extremist ideologies in poor countries and failing to provide alternatives to terrorism is a far greater danger to Americans,” he said. Protectionist language dilutes effort to boost jobs in Pakistan By SAEED SHAH AND GRACE CHUNG McClatchy Newspapers

The DOD calculated that Pakistani loss from the Afghan war was $20 Billion per Annam. The US Aid of $1.5 Billion per Annam is peanuts when compared to what the US spends in Afghanistan on Aid. The Aid to Pakistan should be $150 Billion not $1.5 Billion per Annam. That would make a difference in Islamabad and the area. By eliminating the penury, child malnutrition and infant mortality, the US would be making a great investment in the future consumers of American goods and services