Pakistan's textile industry has seen a troubling 26% decline in cotton yarn and cotton cloth segments, while the apparel sector has grown impressively by 13% in April 2023 and 26% in the 11-month period of FY2023.
Multiple factors, including economic challenges and raw material price fluctuations, contribute to the decline in cotton production. In contrast, the success of the apparel industry is attributed to the depreciation of Pakistan's currency, making labor cheaper and attracting international buyers.
The All-Pakistan Textile Mills Association (APTMA) raises concerns about high energy costs, accounting for 30-40% of production expenses. APTMA demands separate power tariffs that exclude losses and cross-subsidies to enhance competitiveness. Meeting this demand could boost textile exports to $50 billion by FY2027.
Recent data shows a 14.37% year-on-year decrease in the Large-Scale Manufacturing Index (LSMI) in May 2023 and an overall decline of 9.87% in the 11-month period of FY2023. Textiles, automobiles, food, pharmaceuticals, petroleum products, cement, and tobacco contribute to this decline, but wearing apparel and furniture sectors show positive growth.
Comprehensive measures are needed to address challenges faced by the textile industry and leverage the strengths of the apparel sector. Collaboration between the government, industry stakeholders, and policymakers is crucial to enhance productivity, reduce costs, and improve competitiveness, leading to a robust manufacturing sector in Pakistan.
