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APPAREL INDUSTRY IN PAKISTAN

Past Trends in the Apparel Industry

The export of textile and clothing for the period Jul-Dec 2010-11 & Jul-Dec
2009-10. In 2010-11 Jul-Dec, apparel exports decreased by 13.81% in volume
and increased by 1.68% in value. The drop in volumes in 2010-11 Jul-Dec was
mainly due to energy shortage and hike in the cost of raw materials.
www.prgmea.org/pdf/17624.pdf

Export of cotton denim fabrics from Pakistan increased from 229 million
square meters worth Rs20 billion in 2009-10 to 326 million square meters
worth Rs47 billion in 2012-13, thus showing an average increase of 34% per
annum in terms of value.
www.prgmea.org/pdf/15348.pdf

Share of Apparel in Pakistans exports

http://www.prgmea.org/res.asp

Future Trends

Source: Euromonitor April 2013, Report: Non-Grocery Retailers in Pakistan (Current Prices &
Fixed 2012 Exchange Rates, Retail Value RSP incl Sales Tax)

TEXTILE INDUSTRY TRENDS

Growth Trends in Large Scale Manufacturing TEXTILE


(3 years)
Growth

Percentage
Contribution30

FY12

FY13

FY14

FY12

FY13

FY14

TEXTILE

0.2

1.6

1.3

5.9

12

9.9

COTTON YARN

0.5

2.1

1.6

10.1

7.6

COTTON CLOTH

0.3

0.6

0.7

2.5

1.4

1.7

www.sbp.org.pk/reports/annual/arFY14/Real.pdf

TEXTILE INDUSTRY'S ECONOMIC CONTRIBUTION


2011-12
Exports

52% OF TOTAL EXPORTS (US $ 12.36


BILLION)

Manufacturing

46% OF TOTAL MANUFACTURING

Employment

40% OF TOTAL LABOUR FORCE

GDP

8.5% OF TOTAL GDP

Market Captilization (Listed


Companies)

5.0% OF TOTAL MARKET


CAPITILIZATIONSource : Pakistan
Economic Survey, SBP,TDAP

GROWTH OF COTTON TEXTILE INDUSTRY IN PAKISTAN


PERIOD

INSTALLED CAPACITY (in 000)

Period

Unit Spindl Growt Rotor Growt


Growt
Looms
s
es
h%
s
h%
h%

200809
200910
201011
201112
201213

521 1128
0
526 1139
2
524 1176
2
526 11,94
6
526 11,94
6

WORKING CAPACITY (in 000)


Spindles

Growt Rotor Growt


Growt
Looms
h%
s
h%
h%

0.12

194

10241

114

0.99

195

10631

140

23

25

3.25

196

12.50
0.00

10757

143

1.56

214

7.71

10,872

1.98

150

1.56

214

7.71

10,872

1.98

150

According to 2013 report


statistics:
Pakistan is the 8th largest exporter of textile products in Asia.
This sector contributes 9.5% to the GDP and provides
employment to about 15 million people or roughly 30% of the
49 million workforce of the country. Pakistan is the 4th largest
producer of cotton with the third largest spinning capacity in
Asia after China and India, and contributes 5% to the global
spinning capacity.

According to 2014-15 textile budget

Textiles is the most important manufacturing sector of Pakistan


and has the longest production chain, with inherent potential
for value addition at each stage of processing, from cotton to
ginning, spinning, fabric, dyeing and finishing, made-ups and
garments.
The sector contributes nearly one-fourth of industrial valueadded, provides employment to about 40% of industrial labour
force, consumes about 40% of banking credit to manufacturing
sector and accounts for 8% of GDP.
Barring seasonal and cyclical fluctuations, textiles products
have maintained an average share of about 54% in national
exports. However, despite being the 4th largest producer and
3rd largest consumer of cotton globally, Pakistans comparative
advantage diminishes due to export of low value added textiles
products.

MAIN OBJECTIVE OF THE GOVERNMENT FOR


THE NEXT 5 YEARS
To achieve the objectives, Strategic Master Plans will be
developed particularly for export promotion, SME
development, technical textiles and sub-sectors.

TEXTILE BUDGET SCHEME HIGHLIGHTS


(2014-2019)

Draw-back for local taxes and levies would be given to exporters of


textiles products on FOB values of their enhanced exports on an
incremental basis if increased beyond 10% over previous years
exports at the following rates:
Garments 4%
Made ups 2%;
and Processed fabric 1%

Textiles industry units in the value added sector would be provided


Long Term Financing Facility (LTFF) for up gradation of technology
from State Bank of Pakistan at the rate of 9% for 3-10 years
duration.
Mark up rate for Export Refinance Scheme of State Bank of Pakistan
is being reduced from 9.4% to 7.5% from 1st of July 2014.
Sales Tax Regime - An expeditious refund system is being introduced
and a fast track channel for manufacturers-cum-exporters is being
created, whereby FBR would dispose of all their pending sales tax
refund claims within 3 months, if not earlier.
A new vocation training programme will be launched through PSDP
to train sufficient men and women over five years period for skills
required in the value added sector such as garments and made ups.

CLOTHING INDUSTRY FOCUS


Cotton
Model Cotton Trading Houses: The Ministry will set up Model Cotton Trading Houses in Multan
and Sakrand in collaboration with the PCCC, to facilitate farmers, ginners and other
stakeholders. This will also help to encourage standardization and brand development.
Fibre Diversification
At present, Pakistani products are heavily dependent on cotton, whereas the world demand is
for increased use of manmade fibres and other natural fibres. Technical Boards will be
formulated to carry on research on Silk, Wool, Jute, Synthetic, Artificial, and Vegetable Fibres.
Spinning
Investment in new capacities in finer counts, rotor technology, value added attachments and
economies of scales will be encouraged.
Weaving
Weaving City would be established, initially in Faisalabad through PSDP funding and then will
be replicated in other part of the country to de-fragment this sector, along with the provision
to provide space for machinery and spare parts manufacturing.

Knitting
The small and medium knitting units will be supported to increase their capacities, up-gradation of their
machinery and de-fragmentation.
Processing
The Policy would encourage investment in narrow width capacities to increase production of finished
fabrics for the apparel sector.
Technical Textiles
Technical textiles are an emerging area of high value addition and through concerted efforts we can
gain significant share in the world market. However, there is a need to invest in R&D in this area.
Government will develop a proper strategy for the promotion of technical textiles in the country. For
this purpose an exclusive centre of excellence to impart training, develop skills and provide relevant
information about world trends in such fields like geotech, meditech and sportech will be established.
Garments and Made-ups
Entrepreneurs will be encouraged to take maximum advantage of availability of abundant labour force
and for this sourcing and marketing training will be provided along with the establishment of product
development centres. The training would also focus on fashion garments and trends, apparel
merchandising, made-ups designing and quality control etc. The centres will collaborate with leading
fashion institutes to provide in-depth training in specialized high value fashion garments. Programmes
will be initiated to raise profiles of local brands and designers and to explore new overseas markets.
Innovations in garment production will encourage development of new raw materials for the sector.

Working for the Brand Development


The Ministry of Textile Industry would encourage setting up Pak cotton
brand, fashion labels and brands abroad to increase exports. As brand
development requires long term financial commitment, the Ministry
would develop a scheme similar to LTFF with the State Bank of Pakistan
in which loans may be made available at same policy rates available in
LTFF scheme.

Technological problem

The development of the textiles sector in Pakistan was dictated by


the quantitative restrictions imposed by developed countries
under the MFA and ATC, resulting in structural anomalies and
lopsided capacities. While the spinning sector grew quickly, the
highest value added sector woven garments failed to attract
adequate investment due to non-availability of quotas in this
sector.
The overall technological configuration of the industry needs major
up-gradation for replacing that machinery which has become
obsolete or has outlived its economic life.

FUTURE CONSIDERATION FOR THE


CLOTHING INDUSTRY

Focus on quality and innovative fabrics and clothing.


Set yourself apart by using exceptional style detailing, fabrics,
design and line.
Offer good customer services (including the rapid availability of
new/up-to-date fashionable products)
Use crowdsourcing to get assistance with services as necessary
and thus compete with larger companies.
Adapt as soon as possible to changing fashion trends, style
detailing and patterns, and the changing needs of customers.
Innovate.
Technological developments leads to innovative fabrics and to
designs and products with a range of functionalities (e.g..
enhancing the quality of life). They make it possible to tailor
products to customers individual needs and wishes. Innovation in
the production process can contribute to raising the sectors
productivity, improving working conditions and promoting
sustainable manufacturing.

REFERENCES
http://www.sbp.org.pk/reports/annual/arFY14/Real.pdf
http://www.prgmea.org/pdf/33798.pdf
http://www.aptma.org.pk/Pak_Textile_Statistics/repo.asp
http://www.aptma.org.pk/Pak_Textile_Statistics/Gctip3.asp
http://tribune.com.pk/story/522292/statistics-on-textile-industry-in-pakistan /
file:///C:/Users/faisal/Downloads/boutique%20women%20designer%20wear%20rs.%
205.25%20million%20sep%202014.pdf
http://www.knetbook.net/wp-content/uploads/2015/07/Pakistan-Fashion-Industory-.jpg

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