Pakistan’s textile industry continues to be sluggish
According to a commentary article published by Pakistan’s Express Tribune on March 24, it analyzed the reasons for the continued downturn in Pakistan’s textile industry and the widening gap between Pakistan and Bangladesh. The report pointed out that the textile industry contributes 60% to Pakistan’s exports, and successive governments have taken active measures to support the development of the textile industry to promote the overall development of exports. Like the previous government, this government has also launched a series of support programs. However, during its four-year term, the textile industry has not been out of trouble. In fact, Pakistan’s overall exports have dropped by as much as 20% during the current government’s term, resulting in a significant decline in Pakistan’s textile industry. behind Bangladesh. Data show that the gap in the export volume of the textile industry between the two countries widened from US$673 million in the 2011/12 fiscal year to US$1.555 billion in the 2015/16 fiscal year.
Investigating the reasons, manufacturers blame government policies, safety environment and high costs of doing business. Economic experts and analysts believe there is another reason. One is the difference in the international environment. Bangladesh is one of the 48 least developed countries in the world. It enjoys duty-free treatment in developed markets such as the European Union and the United States, while Pakistan, the world’s second largest clothing exporter after China, does not enjoy the same duty-free treatment. treatment, resulting in a growing gap with Bangladesh. The second is the shortage of cotton production. Although Pakistan is the fourth largest cotton producer in the world after China, India and the United States, the biggest problem facing Pakistan’s textile industry today is the sharp decline in cotton production, which has dropped from 15 million bales to 10 million bales, resulting in the country being unable to Not importing cotton greatly increases production costs. The third is the degree of currency depreciation. In the past five years, the Pakistani rupee has fallen from 85.9 to 104.6 against the US dollar, a depreciation of nearly 21%. The Bangladeshi Taka only fell from 74.4 to 78.3 against the US dollar, a depreciation of 5.2%. Compared with the Bangladeshi taka currency, the depreciation rate of the rupee requires Pakistan’s textile industry exports to increase significantly to catch up with Bangladesh, but the reality is exactly the opposite. In addition, China’s labor costs are rising, causing the garment industry to begin to shift outward. As one of the three countries most capable of transferring China’s huge textile industry market: Bangladesh, Pakistan, and Vietnam, Pakistan failed to seize the opportunity and lost development opportunities.
Comments pointed out that despite the deep predicament, the government should continue to support the development of the textile industry to ensure the continued stability of the country’s exports. Pakistan’s textile industry continues to be sluggish
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