Textiles on verge of collapse

Industry officials say exports have declined by 29% YoY as of Feb 2023, totaling $487m

Textile exporters in Pakistan have expressed concern over the state of the industry, claiming it is becoming increasingly unviable and on the verge of collapse. In the past four months, all scheduled meetings with the prime minister have been postponed, leaving them feeling unsupported.

The textile industry is responsible for more than 60% of Pakistan’s exports, but exports have declined by 29% year-on-year as of February 2023, totaling $487 million. From July 2022 to February 2023, total textile exports decreased by 11% to $1.35 billion compared to the previous financial year.

According to Muhammad Jawed Bilwani, Chairman of the Pakistan Apparel Forum and Chief Coordinator of the Value-Added Textile Forum, the government has not responded to repeated calls to save the export industry.

The government’s anti-business and anti-export conduct and behavior is reflected in the unavailability of gas, lack of uninterrupted supply electricity, restrictions on the opening of Letters of Credit (LCs), and excessive delays in refunds to exporters,” said Bilwani, adding that the government has imposed severe restrictions on the import of raw materials and machinery, making it harder for businesses to survive.

The industry has also been hit by increased energy charges, which have made units uncompetitive and caused some to close down.