Karachi, December 21, 2023 – Pakistan’s textile exports faced a significant setback in November 2023, recording a month-on-month (MoM) decline of 8 percent and a year-on-year (YoY) drop of 7 percent, totaling $1.3 billion.
Analysts at Topline Securities Limited attribute this decline to the recent surge in gas prices, posing challenges for textile exporters and impacting their competitiveness in international markets.
In Pakistani Rupee (PKR) terms, textile exports amounted to Rs 376 billion, reflecting a 7 percent MoM decrease while exhibiting a notable 19 percent YoY increase. The YoY growth is primarily attributed to the depreciation of the rupee against the dollar, according to analysts.
Basic textiles experienced a 14 percent MoM decrease but saw a 20 percent YoY increase, reaching $243 million in November 2023. The substantial YoY growth is linked to a remarkable 12-fold increase in raw cotton exports, driven by a significant expansion in the cotton crop compared to the previous year, which was adversely affected by floods.
Value-added textile exports reached $920 million, witnessing a 6 percent MoM and a 12 percent YoY decline. Towels emerged as a major contributor to this segment, facing a 21 percent MoM and 20 percent YoY decline in exports. Knitwear experienced a 5 percent MoM and a 12 percent YoY fall, while bedwear recorded a 16 percent MoM and 8 percent YoY decrease. Ready-made garments faced a 12 percent YoY decline but showed a 5 percent MoM increase.
In the first five months (July – November) of fiscal year 2023-24, textile exports amounted to $6.9 billion, reflecting a 6 percent YoY decline compared to the same period when textile exports reached $7.4 billion. This decline is primarily attributed to the global economic slowdown and reduced demand for textile products worldwide.
Despite the challenges, the government has set an ambitious textile export target of $25 billion. However, industry experts at Topline Securities Limited project that textile exports for fiscal year 2023-24 will likely reach $17 billion, indicating a modest 3 percent YoY increase. This projection takes into account the prevailing economic conditions, global demand fluctuations, and the impact of external factors on Pakistan’s textile sector.
As the industry grapples with the impact of high gas prices and global economic uncertainties, stakeholders are closely monitoring policy measures and market dynamics to navigate the challenges and work towards achieving sustainable growth in Pakistan’s textile exports.
