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Govt expresses concern over shrinking textile exports
26 Jun '08
2 min read
Drooping textile exports of Pakistan has all the likelihood of ruining the entire industry on which the economy depends for its revenues.
Exports from the textile sector dropped by 9 percent to 56 percent due to high cost of sustaining business and colossal competition posed by countries like India, China and Bangladesh. A thorough study has revealed that the worst performance was during July-May of the current fiscal year when exports recorded a negative growth of 2 percent.
Share of the textile sector is likely to reduce even further by the end of this fiscal year and the probability of this should be alarming since the sector is in no state to incur any further losses especially when the country relies on it for its revenues.
Deteriorating exports has resulted in the sector missing its targets for the current fiscal year. Textile exports stood at $9.646 billion during July 2007 to May 2008 against $9.881 billion in the corresponding period of the previous year.
Government had set the share of textile exports at 63.64
percent whereas the export target for these products in terms of value was set at $10.563 billion and it goes without saying that the results achieved were no where close to these figures.
Trade results were more than just disappointing, especially when the textile industry was given huge subsidies in form of Rs19 billion as research and development support and by providing costly loans under long term financing scheme.
However, explaining their reasons, exporters accused high cost of production for such poor performance and believes that the situation would worsen with the enforcement of increased gas rates from July this year.
Additionally, the sector is already dreading the approaching disaster which will result from abolishment of R&D support for textile exports planned from the next financial year.
With the removal of R&D support, apparel based industry which earns more than $3.5 billion for the country and accounts for 25 percent of the total exports would have 40 percent of its industrial labor rendered jobless.
Inspite of decline in revenue of exports from the textile industry, other sectors have done well to offset the loss to a certain extent in income from this segment.
Exports from the textile sector dropped by 9 percent to 56 percent due to high cost of sustaining business and colossal competition posed by countries like India, China and Bangladesh. A thorough study has revealed that the worst performance was during July-May of the current fiscal year when exports recorded a negative growth of 2 percent.
Share of the textile sector is likely to reduce even further by the end of this fiscal year and the probability of this should be alarming since the sector is in no state to incur any further losses especially when the country relies on it for its revenues.
Deteriorating exports has resulted in the sector missing its targets for the current fiscal year. Textile exports stood at $9.646 billion during July 2007 to May 2008 against $9.881 billion in the corresponding period of the previous year.
Government had set the share of textile exports at 63.64
percent whereas the export target for these products in terms of value was set at $10.563 billion and it goes without saying that the results achieved were no where close to these figures.
Trade results were more than just disappointing, especially when the textile industry was given huge subsidies in form of Rs19 billion as research and development support and by providing costly loans under long term financing scheme.
However, explaining their reasons, exporters accused high cost of production for such poor performance and believes that the situation would worsen with the enforcement of increased gas rates from July this year.
Additionally, the sector is already dreading the approaching disaster which will result from abolishment of R&D support for textile exports planned from the next financial year.
With the removal of R&D support, apparel based industry which earns more than $3.5 billion for the country and accounts for 25 percent of the total exports would have 40 percent of its industrial labor rendered jobless.
Inspite of decline in revenue of exports from the textile industry, other sectors have done well to offset the loss to a certain extent in income from this segment.
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