Pakistan total textile exports reported mixed trend in last three years. It earned export revenue of $13.32 billion in Financial Year 2019 (July – June) but rose to $12.53 billion in FY20 and reached $15.40 billion in FY21. The All Pakistan Textile Mills Association (APTMA) is now anticipating textile export to surge at $21 billion in FY22 and hopefully $25 billion in FY23. But subject to continued support in a new incentivised textile policy and subsidy on energy supply. Some business leaders differ, saying it’s improbable, overoptimistic.

Likewise, the growing export trend was continued in September 2021 and textile exports increased by 25% Year on Year to $1.5bn compared to $1.2bn in Sep’20. This was possible despite logistics and supply chain issues such as congestion on ports and higher freight costs, and the growth pattern was also 2% Month on Month. Experts credit the opportunity created due to higher export orders from the US, Europe, and Asian regions after reopening global economies and easing Covid-19 lockdowns. That increased demand for textile products and increased new customer base and value addition, which mainly led to the increase in textile exports during the said period.

Because of these envisaged growth targets, APTMA has informed the government that more than 100 new textile units are being set up across Pakistan and the investment of $ 5 billion in the textile industry after 13 years due to regional energy price for the entire value chain. However, it requested the government ensure the uninterrupted supply of RLNG for power stations so that intermittent flow in the pipeline remains regular. As a result, 500,000 fresh employment opportunities are to be created.

APTMA advocates that regional competitive energy Tariffs of 9 cents/KwH for electricity and $ 6.5/MMBtu for gas/RLNG across the entire textile value chains are critical to achieving $21 billion exports in FY22 as 85% of production is exported. In contrast, only 10% of units are vertically integrated, completing a set target of $ 25 billion in FY23.

The government’s incentives to the textile sector, including a reduction in gas prices for export-oriented sectors, rebates for exporters, lower financing rate on LTFF (Long term financing facility), and export refinance scheme, provided support in these crucial times. Both non-value added and value-added segments showed double-digit growth on a YoY basis (1QFY22). Cotton Yarn remained in demand as sales increased by 69% YoY to $289 million compared to $170 million earlier.

We hope the government will continue rationalising imports tariffs on raw materials and power subsidies. Experts believe that the demand for Pakistan’s textile exports will likely remain strong due to the continued rerouting of orders out of China and other regional Asian countries. The capital investments by various textile exporters is an indication of solid order flows, while the recent PKR depreciation also enhances exports’ competitiveness. We firmly believe that all these factors will increase our exports and ease pressure on the trade deficit.