Japan is the third largest garment importer in the world after the US and Germany. But imports from China are gradually declining. Chinese garments which constituted 84 per cent of Japan’s imports at one time reduced to 75.6 per cent in 2013, while the share from ASEAN countries surged by 8.4 per cent. Japanese garment buyers have invited Pakistani producers to tap their market as they intend reducing garment imports from China.

Japan is an industrialized country deficient in natural resources and raw materials hence it relies heavily on value added exports to pay for these imports. On the other hand, Pakistan stands in the category of developing countries deficient in technology and endowed with natural resources of fertile agricultural land and raw materials. The natural resource endowments and economic backgrounds of these countries make a strong match for engaging in trade and investment.

During the early days of Japan-Pakistan foreign trade relations, Pakistan exported raw cotton to Japan and Japan processed the cotton into yarn and cloth and then exported them back to Pakistan. This pattern shifted later on as Japan began to export spinning machinery to Pakistan, and currently textile yarn and fabric is the largest component of Pakistani exports to Japan.