Karachi, January 19, 2024 – Pakistan’s textile sector, a cornerstone of the nation’s economy and a major contributor to foreign exchange earnings, has experienced a notable setback with a 5 percent decline in exports, totaling $8.28 billion during the first half (July – December) of fiscal year 2023-24.
This downturn comes as a concern, given the pivotal role that textile exports play in Pakistan’s economic landscape.
Data released by the Pakistan Bureau of Statistics (PBS) on Friday reveals a notable drop from the $8.72 billion recorded in the corresponding half of the previous fiscal year. Textile exports constitute a significant portion, contributing 55 percent to the total exports, which amounted to $15 billion for the country in the first half of the current fiscal year.
Within the textile segment, there has been a mixed performance among different categories. Notably, raw cotton and cotton yarn have emerged as the growth leaders, experiencing a substantial increase of 374 percent and 54 percent, respectively, during the period under review. This surge in these categories is a positive development that may provide some offset to the overall decline in the sector.
Conversely, there have been significant setbacks in other sub-sectors. Knitwear and readymade garments, integral components of Pakistan’s textile exports, have faced challenges, experiencing declines of 11 percent and 9 percent, respectively. The reasons behind these declines are multifaceted and could be attributed to factors such as changing global demands, supply chain disruptions, or competitive pressures.
The month of December 2023, however, brought a glimmer of hope to the textile sector, as exports rebounded to $1.4 billion. This figure represents a 3.33 percent increase compared to the same month in the previous year and a more substantial 6.15 percent rise when compared with November 2023. While this uptick in December offers a positive sign, industry stakeholders will closely monitor whether this momentum can be sustained and translated into a broader recovery for the sector.
Experts believe that addressing the challenges faced by knitwear and readymade garments, which have been major contributors to the overall decline, will be crucial for revitalizing Pakistan’s textile industry. Additionally, the government and industry players may need to explore strategies to further diversify the textile export portfolio, capitalizing on the success seen in raw cotton and cotton yarn.
The global economic landscape, geopolitical factors, and ongoing uncertainties related to the COVID-19 pandemic continue to impact international trade. Pakistan’s textile sector, being highly dependent on global markets, must navigate these challenges adeptly to ensure long-term sustainability and growth.
As stakeholders assess the data released by the PBS, collaborative efforts between the government, industry, and relevant stakeholders will be essential in devising strategies to address the challenges faced by the textile sector, ensuring its resilience and competitiveness in the global marketplace.
