Pakistan's textile exports to China are in the form of low value-added fabric and yarn. China transforms the product into a higher value-added form. There has been a slowdown in Chinese demand for yarn and fabrics but Pakistan has made up for it in the value-added segment by increasing exports to European Union on the back of its new GSP Plus status. Pakistan’s yarn exports to China dropped 8.6 million kg. The country exported 43.41 million sq. mtr less fabric in January 2014 compared to January 2013.

In the value added segment, Pakistan’s exports of knitwear to EU jumped by 16 per cent between January 2013 to January 2014. Exports of bed wear increased 8.8 per cent and readymade garment exports were up 8.4 per cent. Had exports to China been normal, textile exports would have posted an overall gain of 15 per cent in January this year, over exports made during the corresponding month of the last year.

The uptrend in value-added exports shows that GSP Plus is positively impacting Pakistan. The country’s textile industry is now gearing up to capitalise on the GSP Plus status. Since the time Pakistan has got GSP, the number of summary orders has been rising.