Pakistan’s exports of apparel and textiles have decreased, and the powerful industry lobby group Aptma is back, demanding ever-higher energy subsidies. According to latest PBS trade data, textile exports fell 3 percent year over year and 10 percent month over month in July. The industry’s $16.3 billion to $16.6 billion in exports has been declining over the past two years. The textile lobby blames increased energy costs, as usual, for the fall in exports. However, it goes beyond that. The trend of textile exports demonstrates that the sector has not been able to increase the volume of its overseas sales. It goes beyond that, though. Despite receiving significant energy subsidies over the past few decades, the textile industry has not been able to increase the volume of its exports abroad, as evidenced by the exports’ trend. Increased global commodity prices were the primary cause of the export boom, either after the pandemic or earlier in the decade. Earnings from textile exports decreased when commodity markets dropped.
The Economic Advisory Group think tank conducted a study on the post-pandemic performance of Pakistan’s textile and apparel industry and discovered that a jump in global prices was the sole reason for 70% of the textile exports’ dollar value increase. The remaining 30% resulted from an increase in textile export volume due to a rise in worldwide demand. The industry in Pakistan has experienced a decline in competitiveness due to rising production costs. However, the industry’s stagnation can be attributed more to the government’s inability to utilize substantial support, such as energy subsidies and cash rebates, to shift towards high-value segments, diversify products in line with global trends and demand, upgrade technology to become more efficient, and cut costs. Despite being late entrants, Bangladesh and Vietnam, two other regional rivals, have achieved a far larger market share by doing it. Despite being late entrants, other regional rivals like Vietnam and Bangladesh have done that to seize a far larger market share. Over the past 20 years, Bangladesh’s exports of apparel and textiles have surpassed $47 billion and drawn a sizable amount of foreign direct investment. Some textile leaders have asserted that they might fill the void left by the country’s current political unrest, which threatens to drive Bangladesh’s textile industry into a catastrophe, if the government lowers energy costs for the sector. The truth is that ready-made clothing accounts for more than 80% of Bangladesh’s textile exports. Pakistan’s garment industry accounts for only 5 percent of its total exports; even in the unlikely event that a chance to replace Bangladesh comes, we lack the products and infrastructure necessary. Despite being late entrants, other regional rivals like Vietnam and Bangladesh have done that to seize a far larger market share. Over the past 20 years, Bangladesh’s exports of apparel and textiles have surpassed $47 billion and drawn a sizable amount of foreign direct investment. Some textile leaders have asserted that they might fill the void left by the country’s current political unrest, which threatens to drive Bangladesh’s textile industry into a catastrophe, if the government lowers energy costs for the sector. The truth is that ready-made clothing accounts for more than 80% of Bangladesh’s textile exports. Pakistan’s garment industry accounts for only 5 percent of its total exports; even in the unlikely event that a chance to replace Bangladesh comes, we lack the products and infrastructure necessary.
