Four thousand years ago, the Harappa civilization of
Pakistan gave the country the tradition of weaving and spinning. This age-old
tradition has been carried on by Pakistan, which has grown to be the eighth
largest exporter in Asia of textile products. Pakistan is the fourth largest
cotton producer in Asia, after India and China. It also has the highest
spinning capacity in Asia.
Pakistan has 442 spinning mills and 1260 ginning units.
There are also 2550 garment manufacturing firms, 600 knitting producing units,
and 600 garment manufacturing units. To export to countries such as the USA, Hong Kong,
Germany, France, Italy, France and Netherlands, textile products such
as carpets, rugs and towels, home textiles and hosiery, and Afghanistan, are
made here. The strong foundation of Pakistan's economy is textile. Nearly 50%
of total international exports are textile products and garments. They account
for almost 8.5 percent of GDP and 38.9% of the country's labor force.
As far as procurement and the use of raw materials go,
Pakistan's spinning industry is competitive but open to all. The sourcing of
cotton from abroad began in Pakistan ten years ago due to scarcity of crops.
The nation currently sources approximately 3 million bales of international
cotton and produces nearly 11.5 million domestically.
Pakistan's Textile Industry
Pakistan has a Free Trade Agreement with EU. The country's
textile industry has helped to ensure that it enjoys positive relations with
the EU. The European Union has lifted Pakistani tariffs on products exported.
Also, a December 2013 law granted Pakistan a Generalized Scheme of Preferences
status (GSP Plus). The agreement and the allocation of work started in January
2014, and will continue until 2017. The European Union will be able to import
cheap textile products from Pakistan. However, the Pakistani government will
also benefit by creating jobs and economic growth. In the first year alone, GSP
Plus will increase textile and apparel exports by $ 650 million.
In order to support the sector and improve its performance,
the government of Pakistan also made changes in the 2014-2015 textile policy.
These revisions focus on the development of quality textile products, as well
as proper infrastructure facilities and investments. It will also focus on regional
trading to increase production capacity of garments in Karachi and Islamabad.
The government has not made enough efforts to address the
energy crisis. To increase power supply, the government has yet to fulfill its
promise of installing continuous electricity and gaz plants. This has had a
huge impact on Pakistan's textile industry. The result was that manufacturers
had to look for alternative ways to produce electricity, such as inverters and
generators. This ultimately led to higher production costs. Exporters of
textiles suffered increased costs and decreased profitability due to the
shortage of electricity. Many factories were forced to close down due to lack
of electricity and many people were left unemployed.
The apparel and textile industries of Pakistan are also subject to fierce competition from countries like India, China, Bangladesh, and Bangladesh. The country is also facing significant economic obstacles, such as the depreciation and rise in interest rates, double-digit inflation, rising raw material costs, and rising prices for cotton and yarn. The lack of adequate infrastructure, modern machinery and skilled labor force is also a major obstacle to the country's textile industry growth. Additional problems are caused by political instability and internal security concerns. These worries are causing concern among foreign buyers and giving them reason to source textile products from Pakistan's neighboring countries.
To impress international buyers, the country must also improve its safety and health standards. Walt Disney recently ended all garment orders from Pakistan-based manufacturing units for the same reasons. 16 companies were unable to continue operations in Pakistan, resulting in a loss of $ 150 million. This is bad news for the textile industry as US imports textile products valued at $ 3.2 billion. Each year, companies export $ 1.2 billion worth garments to brands such as GAP, Levis Strauss and Nike.
International companies from the US and EU have demanded
that the country's manufacturing units adopt a Better Work Programme (BWP) to
improve working conditions. The International Labour Organization (ILO), had
also warned the country against poor labour conditions and inadequate
monitoring. If manufacturers fail to comply with these rules and systems, they
will be in serious trouble and could lose their orders.
The textile and garment sector of Pakistan has enormous
potential for expansion if it considers the many obstacles that need to be
overcome, particularly by the government. Inability to compete on the
international market against its highly skilled and growing peers can result in
the textile industry being unable to take the necessary steps.
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