TEXTILE INDUSTRY

OF
PAKISATAN
By:
Maliha Shahnawaz
(SP06-BW-0006)

Anila Irum
(SP06-BW-0002)
 OUTLINE
 Introduction
 Importance
 History
 Global overview
 Textile industry in Pakistan
 Distorted Economic Growth
 Processes – value chain
 Exports and Imports
 Trade Policy 2007-08
 Investment and FDIs
 Factor of Production
 Linkages
 Special Organizations
 Textile Vision 2005
 Textile City
 Ancillary Textile Industry
 Reforms
 Target Markets
 Textile training
 Industry support program
 Cluster Development
 Globalization and WTO
 Future Prospects
 Budget and Policies
 Incentives
 SWOT analysis
 Environmental Hazards
 Problems and Challenges
 Conclusion and Recommendations
 INTRODUCTION
 The textile industry is one of the most important sectors of Pakistan. It
contributes to the country’s GDP, exports as well as employment. It is, in
fact, the backbone of the Pakistani economy.

 Textile industry has the largest potential for boosting exports from Pakistan.
Apart from its basic contribution of clothing the nation and at the same time
earning largest foreign exchange through exportable items.

 The textile industry holds the key to the growth and expansion of the
country's cotton economy, which continues to be the main cash crop.

 Textile Production is comprised of Cotton ginning, cotton yarn, cotton

fabrics, towel, hosiery, knitwear and ready made garments.
IMPORTANCE
 Textile products are a basic human requirement next only to food

 4th largest Producer of Cotton

 3rd largest Exporter of raw cotton

 A leading Exporter of yarn in the World

 Availability of cheap labor and basic raw cotton

HISTORY
 In 1947, 78000 spindles and merely 3000 looms that is too in the unorganized sector, with only one textile unit.

 In the late fifties PIDC came into being which had the main objective of industrializing the country in
inauguration of the Valika Textile Mill at Karachi.

 In 1959, the 9 largest industrial houses accounted for 50 percent of the total production.

 The period between 1958 to1968, economy, especially industry experienced a relatively higher growth rate
during the Ayub Regime.

 By the mid sixties there were about 180units of textile bleaching, printing, and processing units, mostly
situated in Karachi and Punjab. A number of spinning units ( comprising of only 12,500 spindles) were set-up.
Newly established mills were based upon imported technology but there was lack of technical staff and
shortages of capital.
Cont…
 Between 1960 and 1970 Pakistan’s textile industry enjoyed over 11 percent of the
world market share but today the corresponding figure is only slightly over 2 percent.

 By 1970-71 there was 113 units and the industry has 2,065 thousand spindles and 30
thousand looms. After the separation of East Pakistan Cotton Export Corporation of
Pakistan was established which meant the most of the private sector work was taken
over by the state. The textile industry suffered heavy losses because the export of
cotton was controlled by the CEC. And the import of the machinery was made
difficult due to shortages of foreign exchanges.

 The decade of development was followed by the Bhutto years from 1971 to 1977. His
regime was characterized by the nationalization of the large scale manufacturing
sector, insurance companies and banks.
 Cont…
 The eighties brought a relief to the textile industry due to the industry friendly policies
of the government. There was a rapid growth in spinning sector. Till 1980-81 spinning
continued to expand to 4033 thousand spindles in 203 spinning units, and working
capacity amounted to 2833 thousand spindles.

 During the nineties a combination of factors adversely effected the industry, mainly:
1. Removal of export duty on raw cotton, increasing domestic prices to international levels
and beyond.
2. Infestation of the cotton crop by leaf curl virus, reducing supply sharply and increasing
prices.
3. Frequent changes in governments creating inconsistency in policies of the Government
and Financial Institutions.
4. Rapid expansion of the installed industry in the hands of new entrants who did not have
the managerial skills or the liquidity base to succeed.
5. Rapidly changing global markets, especially the shift towards man made fibers.
 World demand for good quality, wide width fabrics grew and replacement
and modernization process started. With these developments, production
and export value added items such as bed sheets and home furnishing
started.

 Structural changes with the replacement of obsolete machinery and

modernization in the industry still continued in view of the world
competition.

 In the nineties and the early 2000s a textile manufacturers were making
large profits by merely trading quotas rather that diversifying into higher
value-added products where quotas were not required.

 “Textile vision 2005” has identified the present status and opportunities
TEXTILE INDUSTRY
IN PAKISTAN
 The nation is characterized as the single crop economy that includes cotton and
textile and they contribute immensely in the Pakistan national economy.

 The textile industry in Pakistan has tremendous potential to grow, provided its
comparative advantages are maintained.

 Pakistan has gradually emerged as world’s largest supplier of yarn, with china
as one of the major buyers.

 Pakistan has potential to become a strategic supplier of textile products for

world’s major malls and stores, which again want a guaranteed and timely
supply from the source.
Distorted Economic growth
 The 1960s, so-called ‘golden decade', era of industrialization, averaging
6.7% growth. On the one hand, this gave rise to the famous 22 richest
families in Pakistan controlling most of industry and the economy. On the
other hand, it created the sea of poverty in which 46% of the population
was living.

 Agriculture is employing 44% of the workforce and contributing 20.9% of

GDP in 2007-08 as compared to 21.8% in 2006-07.

 Feudalism, water shortages, highly expensive electricity, fertilizer and

seeds, decreasing land for cultivation, very low output and yield, and old
methods of farming, are the main reasons for crisis also Pakistan’s
economy is largely dependent on foreign aid and loans.
PROCESSES
 The number of separate processes involved in production varies with each textile
product.

 The initial stage of textile manufacturing involves the production of the raw
material either by farmers who raise cotton, sheep, silkworms, or flax or by
chemists who produce fiber from various basic substances by chemical processes.

 The fiber is spun into yarn, which is then processed into fabric in a weaving or
knitting mill.

 After dyeing and finishing, the woven material is ready for delivery either directly
to a manufacturer of textile products or to a retailer, who sells it to individuals for
use in the making of clothes and such household articles as draperies, upholstery,
and curtains.
 TEXTILE INDUSTRY'S
ECONOMIC CONTRIBUTION
2007-2008
Exports  53.8%
Manufacturing 46% 
Employment 39% 
GDP 8.5% 
Textile Export $6.3 billion
Investment $7.0 billion 

Source: Economic Survey of Pakistan 2007-

08
EXPORTS
 Overall export recorded a growth of 10.2% during the first ten months (July –
April) of the current fiscal year against a growth of 3.6% in the same period
last year.

 In absolute terms, exports have increased from $13847.3 million to $15255.5

million.

 In Asia, Pakistan is the 8th largest exporter of textile products.

 STRUCTURE OF EXPORT ($ Millions)

Particulars July - April % Change Absolute increase/

decrease
2007- 08* 2006-07
Textile Manufactures 8649.6 8875 -225.5 -16
Raw Cotton 58.1 45.3
Cotton Yarn 1070.6 1176.5
Cotton Cloth 1572.5 1717.5
Knitwear 1504.3 1479.9
Bed Wear 1565 1634.7
Towels 497.6 506
Readymade Garments 1200.2 1250.8
Made-up Articles 428.6 419.4
Other Textile 752.7 645
Manufacturers
* Provisional
Source: Federal Bureau of Statistics
 EXPORT OF TEXTILE MANUFACTURES (Share)

Items 2007- 08* 2006-07 2005-06

Cotton Yarn 12.4 13.6 13.7
Cotton Cloth 17.7 19.3 21.6
Knitwear 17.3 18.7 17.6
Bed Wear 18.1 19 20.8
Towels 5.6 5.7 5.8
Tents, Canvas & Tarpaulin 0.7 0.7 0.3
Readymade Garments 14.1 13.2 13.8
Synthetic Textiles 5.1 4 2
Made-up Articles 5 4.5 4.3
Others 4 1.3 0.1
100 100 100
* July - March (Provisional)
IMPORTS
 The textile machinery used in Pakistan is imported mainly from the
countries of Japan, Switzerland, Germany, China and Belgium.

 Import during the first ten months (July-April) of the current fiscal year
(2007-08) grew by 28.3 % compared with the same period of last
year,reaching to $32.06.
 Import of Textile Machinery
Year Million US $ % Change
1999-2000 210.9 28.6
2000-01 370.2 75.5
2001-02 406.2 9.9
2002-03 531.9 30.7
2003-04 597.9 12.4
2004-05 928.6 55.3
2005-06 771.5 -17.0
2006-07 503.0                     -36.7
2007-08 (Jul–  318.2
Mar)

Total 4638.3
Source: Federal Bureau of Statistics 
INVESTMENT
Textile industry has made
an investment of about
$7.0 billion during the last
six years. This investment
includes both investments
through bank loans as
well as own sources. This
investment has been made
in the form of BMR
expansion and new
capacity.
FOREIGN DIRECT INVESTMENT
 57% FDI comes from 3 countries namely UAE , US, and
UK.

 US investors are on the top with 33.4% investment in

2007-08.
 Net Inflow of Foreign Direct Investment
( US $ Million)

Economic Group July - March 2006-05

2007-08 2006-07

Textiles 22.3 46.8 59.4

Source: SBP
 FACTORS OF PRODUCTION
Raw Cotton
 Cotton is a natural vegetable fibre used primarily as a
raw material for textiles.

 World cotton production is estimated at 118.8 million

bales in 2007-08 – 3% lower than last year because
of the decline in world area by 1.2 million hectares to
33.6 million hectares.

 In 2007-08, production is estimated to decline in the

USA (12%), China (3%), Pakistan (9.3) and Turkey
(12%). Production in 2007-08 is estimated to increase
in India by 11.1 percent and in Brazil by 5percent.

 Leading producers of cotton include USA, China,

India, Pakistan, Uzbekistan and Turkey.
 Review of Domestic Cotton
Situation
 Cotton accounts for 7.5 percent
of the value added in agriculture
and about 1.6 percent to GDP.

 The cotton area sown in the

Punjab Province in this season
was less by 2.5 percent
compared with last year.

 Secondly, the cotton area sown

in Sindh was 6 percent higher
than the last year.
 Cotton Prices
 Cotton prices this season in the
country remained significantly
higher than last year. The seed
cotton prices during the season so
far has averaged at Rs 1,422 per 40
Kgs, as against last year ‘s average
price of Rs 1,171/-.

 In other words farmers received, on

average, 21.4 percent higher prices
this year.

 Cotton prices in the world market

have also remained significantly
higher than last year.
 Area, Production and Yield of Cotton

Year Area Production Yield

(000 % Change (000 % Change (Kgs/ %

Hectare) Bales) Hec) change

2005-06 3103 -3 13019 -8.7 714 -10.3

2006-07 3075 -0.9 12856 -1.2 711 -0.4

2007-08 3054 -0.6 11655 -9.4 649 -8.7

(P)

P = Provisional (July - March)

Source: Ministry of Food, Agriculture & Liverstock, Federal Bureau

of Statistics
Performance of Textile Industry
on KSE 
 There were 209 companies listed with the KSE under group ( Textile spinning,
textile weaving and composite and other textiles) in december 2007 as
compared to 212 companies in 2006.

 The share index of cotton and other textiles was up by 11.6% and its market
capitalization by 13% during July-April 2007-08.

 The profit before taxes of this sector was also reduced to Rs. 8.2billion in 2007
when compared to Rs. 9.3 billion in 2006.
SPECIAL ORGANIZATION
 All Pakistan Textile Mills Association is the chief organization that
determines the rules and regulations in the Pakistan textile industry.

 All Pakistan Textile Mills Association (APTMA) is the premier

national trade association of the textile spinning, weaving, and
composite mills representing the organized sector in Pakistan.

 APTMA represents 391 textile mills out of which 309 are spinning, 45
weaving and 37 composite units.

 The total installed capacity of APTMA member mills accounts for

9,527,857 spindles, 61,256 rotors, 9,922 Shuttleless/Airjet Looms and
717 conventional Looms.
PRESENT STATUS OF PAKISTAN
TEXTILE ENGINEERING SECTOR
 The Pakistan Textile Engineering Sector is underdeveloped and under utilized.
 The Textile Engineering Units vary from small, medium and large in size.

 The Textile Engineering Industry comprises approximately 80% small work

shops, 15% medium engineering Units and 5% large Engineering Units.

 On the basis of initial survey of Textile Engineering Units (Not complete yet),
approximately 500 units are engaged all over Pakistan, employing
approximately 50000 work force which is mostly skilled. Even under the
present conditions and without any support, Pakistan Textile Engineering
Industry is providing import substitution worth around one billion US dollars.
This sector also exports to small and medium Textile Units in Bangladesh, Iran,
SriLanka,etc.
MAJOR COMPETITORS
 The Pakistan textile industry is facing tough competition from the Indian,
Bangladeshi and Chinese textile industries. The cost of power in Pakistan is high as
compared to that in other countries.

 Bangladesh, India and China enjoy comparatively low interest rates than Pakistan.
The prevailing rates are as following, 8.5 to 9.0 per cent in Bangladesh, 5.25 per
cent in India (market rate is 10.25 per cent, however exemption of 5 percent is
provided to the textile industry) and 5.58 per cent in China. Meanwhile, in Pakistan,
the last three to four years has seen the interest rates to have risen more than 150
percent, to 13.25 percent.

 China has expanded textile exports from $ 39.5 billions in 1998 to $ 80.0 billions in
2003.

 Buyers are watching the global supply position & if Pakistani Entrepreneurs are not
willing to change, the buyers will shift to China which has developed a large supply
base for Textile Products.
 TEXTILE VISION 2005
 An Open, Market Driven, Innovative & Dynamic Textile
Sector Which is
 Internationally Integrated

 Globally Competitive

 Fully Equipped to Exploit the Opportunities Created by

MFA Phase Out

 And Which Enables Pakistan to be Amongst the Top Five

Textile Exporting Countries in Asia.
 Employment Generation in Textiles
Textile Vision – 2005
Current New Employment % Increase
Employment

Stitching 734,805 822,267 112%

Processing 61,206 56,340 92%

Knitting 47,221 19,161 41%

Weaving 294,213 15,484 5%

Spinning 201,151 123,600 61%

Total 1,338,597 1,036,853 77%

 CRITICAL REQUIREMENT
 Pakistan’s Textile Industry has potentials to increase volumes of textile
exports and enhance earnings by shifting more & more to high value added
products.

 A comprehensive policy package is desired to support the Textile Industry

to survive & win the post MFA competition by making available the
necessary facilities & infrastructure in a timely manner.

 It is critically necessary for Pakistan to provide infrastructure for Textile

Industry to expand in size and volume to compete in the international
market after the elimination of MFA quota by 1st January, 2005.
 REQUIRED ACTION
 In order to give a boost to export of value added textile
products at a quicker pace, Textile Vision 2005 proposed
establishment of

“Textile City”.
 PROJECTS - TEXTILE INDUSTRY DIVISION
Name & Status of the Scheme Cost (Million Rupees)
S.No.
Ongoing
1 Pakistan Textile City Karachi 1000.000 Billion (Share of
Federal Government)
2 Lahore Garment City 497.640
3 Karachi Garment City 1291.000
4 Faisalabad Garment City 498.82
New
1 Implementation of Export Plan 22000.000
2 Establishment of Fibre Testing 68.860
Laboratory Phase II
3 Up-gradation of Cotton Fibre Testing 28.656
Laboratories
4 Providing & Laying Delicated 48 inch 636.585
Diameter mild Steel Water main for
Textile City Karachi
TEXTILE CITY
 The concept of textile city is based on supply of industrial infrastructure like natural
gas, water, electricity, sewerage and waste disposal mechanism to prospective investors,
through one-window operation, so that they are facilitated to focus on investment and
production without having to worry about arranging the infrastructure requirements.

 Pakistan Textile City is an industrial zone dedicated to the textile processing and related
industry. Comprising of a total area of 1250 acres, the estate is located in the Eastern
Industrial Zone of Port Qasim Karachi, 6 km from the National Highway.

 Pakistan Textile City will offer the textile processing industry the desired state-of-the-
art environment to achieve cost effective high productivity. The facility will provide
uninterrupted power, clean and continuous water supply, natural gas, effluent treatment
and efficient transportation systems. Services will be streamlined as a one window
operation and managed in a highly efficient and professional manner.
Cont…
 The forecast is that 30 millions jobs will be put on hold.

 Employing 40 million workers worldwide, most of them in poorer

countries, textile sector generates trade worth $400 billion annually, both
in clothing and textiles. In the global production China, has a share of 17.5
per cent, Pakistan 2.2 per cent, USA 4.5 percent and EU 12 per cent share.

 Pakistan employs four million in textile and clothing sector that could rise
to 15 million in the absence of quotas.

 When in full operation, Bin-Qasim Textile City is expected to generate

80,000 job opportunities.
 HIGHLIGHTS OF THE
TEXTILE CITY
Exclusive production area with Compliant to WTO standards for
excellent infrastructure. social, health and environment

Location Port Qasim, Karachi

Infrastructure Land : 1250 acre

Water : 18 MGD
Gas : 40 mmcfd 
Power: 100 M.watt.

Capacity of one dying (knitting) Unit Average 40 MT/day (Min. 20 MT/day)

Capacity of one dying (woven) Unit 100,000 meters/day

Minimum No. of dyeing units in the 35

Zone
 Salient Features of Pakistan
Textile City Project
Infrastructure Zones
 Exclusive Textile Environment
 One Window Operation without Red Tape
 Weaving
 Synergistic Environment  Bedlinen
 Stable Power Supply  Denim
 Consistent Water Supply (tds quality)  Knitwear
 Gas for Processing and Power Generation
 Effluent Treatment Plant
 Towel
 Sewerage and Storm Drainage System  Apparel
 Roads and Advanced Telecommunications  Dyeing
infrastructure
 Security and Fire Fighting Systems
 Proximity to Modern Port Facilities
 Amenities
 Proximity to Workers Residence
Cont…
Services Support Industries
 Textile Processing Lab
 Zips, Buttons, Thread
 Advanced IT infrastructure
 Printing, Packaging
 Technical Training Centers
 Computerized Weigh Station  Engineering Workshops

 Banks, Freight Forwarders,

 Travel Agent, Courier Company,
 Post Office
 Restaurants
 Public Transport, Mosque,
 Fire Station, Private Security
 ANCILLARY TEXTILE
INDUSTRY
 Textile production is comprised of cotton ginning cotton yarn, cotton
fabric , fabric processing (grey, dyed, printed), home textiles, towels,
hosiery and knitwear and readymade garments.

 These components are being produced both in the large scale organized
sector as well as in unorganized cottage / small and medium units.
 i) COTTON GINNING
SECTOR
 Leading producers of cotton include USA, china, India, Pakistan,
Uzbekistan and turkey. The current market share of cotton in 56 percent in
all fibers. Textile fibers are divided into three basic types according to their
sources such as cotton fiber, man made fiber and wool. In last ten years the
percentage share of cotton has shrunk from 48 percent to 39 percent in the
total fibre consumption. there are 1221 ginning factories in the country.

 Ginning industry has installed capacity of more than one million bales on a
single shift basis and total capacity of around 20million bales on three shift
bases.
 ii) COTTON SPINNING
SECTOR
 Spinning is the process of converting fiber into yarn.

 Pakistan has the third largest spinning capacity in Asia with a spinning
capacity of 5% of the total world and 7.6% of the capacity in Asia.

 Pakistan growth rate in this sector has been 6.2% per annum.

 At present, cotton-spinning sector is comprised of 421 textile units (50

composite units and 471 spinning units) with 10.1 million spindles and 114
thousand rotors in operation with capacity utilization of 89 percent and 60
percent respectively, during July-Mar 2007-08
iii) WEAVING AND MADE-
UP SECTOR
 There are three different sub-sectors in weaving i.e, Integrated,
independent Weaving Units, and Power Loom Units.

 This sector is producing comparatively low value added Grey Cloth of

mostly inferior quality.

 However, the performance of cloth sector remained far better than last year
and charted a growth of 12.6 % during July – March 2007-08 .
 Installed and Capacity Worked in Weaving Sector (Nos.)

Category Installed Capacity Effective/ Capacity

Worked

Integrated Textile Units 7599 3471

Independent Weaving Units 27500 27000

Power Loom Sector 295442 285442

Total 330541 315913

Source: Textile Commissioner Organization

 iv) COTTON CLOTH
 Production of cloth, both from mills and non-mills sector have a registered
growth of 2.7% during July-March 2007-08.

 However, it recorded negative export growth for July-March 2007-08

(11.0%) as compared to 2006-07.
v) TEXTILE DOWN
STREAM INDUSTRY
 This is the most dynamic segment of textile industry. The major product
groups are towels, tents and canvas, cotton bags, bed wear, hosiery &
readymade Garments including fashion apparels.
 a. HOSIERY INDUSTRY
 There are about 12,000 knitting machines spread all over the country. The
capacity utilization is approx 70%.

 The sub sector remained under pressure form its competitors during the
year amend tough competition emerging from the newly inducted members
to the European union belonging to the former east European bloc.
b. READYMADE GARMETS
INDUSTRY
 The garment industry provides highest value addition in textile sector. This
industry is distributed in small, medium and large scale units most of them
having 50 machines and below;

 The industry enjoys the facilities of duty free import of machinery and
income tax exemption during the year under review the sector recorded a
healthy growth in exports (7.3%) as compare to last year.
 c. TOWEL INDUSTRY
 There are about 7500 towel looms in the country in both organized and un
organized sector.

 Towel industry showed a negative growth of 3.9% in FY08 against

FY07.over 300% increase in export of towels in past indicate that
tremendous possibilities exist for future expansion providing the existing
towels manufacturing factories are up-graded to produce better quality
towels so that they have a fair chance in international market.
 d. CANVAS
 Canvas exports can be subdivided into five categories i.e. tarpaulins,
awnings,& sun blinds, tents sails pneumatic mattresses and camping goods.

 Being the highest raw cotton consuming sector its production capacity is
more than 100 million square meters. Around 60% of its production is
exported while 40% is consumed locally by armed forces food
department. During( July-march) 2007-08 canvas exports showed a decline
of 3.1%.
 e. SYNTHETIC YARN
MANUFACTURING
SECTOR
 It registered vigorous export growth of 41.0% during July – March 2007-
08.

 Presently, there are 7 polyester fiber units with production capacity of

640,000 tons per annum,
vi. FILAMENT YARN
MANUFACTURING
INDUSTRY
 The synthetic Filament Yarn Manufacturing industry picked up momentum
during 5th Five Year Plan when demand and hence import increased and
private sector was permitted to make feasible investment in the rising
market conditions.

 Only about 6 units with operational capacity of 55,000 tons is supplying

polyester filament yarn.
 Capacity of Synthetic Filament Yarn
Type of Yarn  No. of  Production of Capacity 
units (Metric. Tons)
Acetate Rayon  1 Units 3000
Yarn 
Nylon filament  2 Units 2000
Yarn
Polyster filament  21 Units 95000
Yarn
Source: Textile Commissioner's Organization
 vii. ART SILK AND
SYNTHETIC WEAVING
INDUSTRY
 Art Silk and Synthetic weaving Industry has developed over time on
cottage based power looms units comprising of 8-10 looms spread all over
the country.

 There are approximately 90,000 looms in operations of which 30,000

looms working on blended yarn and 60,000 looms on filament yarn.

 This sub-sector showed a export growth of 40.9% during July-March

2007-08 and earned $396.1 million for national exchequer.
 Reforms in the Textile sector
 The MINTEX has taken number of proactive measures since
its inception. These includes,
 Federal Textile Board (FTB)
 Textile Skill Development Board
 Textile Training Institute Management Board (TTIB)
 Federal Textile Board (FTB)
 Federal Textile Board (FTB) is functioning under the Ministry of Textile
Industry.

 In order to prepare textile industry for post quota scenario the government
in Sept, 2000 set up FTB.

 It has been tasked with clean cotton program, labor , social and
environmental laws , modernization of ginners, rationalization of tariff,
facilitation in sales tax issues and to develop packages to promote garments
sector by improving their competitiveness in global market.
Progress Made by the Board
 Changes in Labour Laws
 Seminar on Cotton
 Clean Cotton Programme
 Inclusion of weaving sector in long term financing scheme
 Exemption from Sales Tax on import
Textile Skill Development Board
 It was set up in the Ministry of Textile Industry in pursuance of the Trade Policy
2005-06 initiative for support to the textile garment sector wherein garment
manufacturing units were to be declared as skill development training institutes.

 The objective of board was to train of 10,000 to 12,000 operators in one year.

 The scheme has been launched 34 garments unit have joined the stitching machine
operators training (SMOT).

 In which 15 units in Karachi, 11 units in lahore,7 units in Faisalabad and one unit
in Rawalpindi.

 About 3800trainees have been trained of which 2700 are females and 1100 males.
 Textile Training Institute
Management Board (TTIB)
 Pakistan's human resource development profile needs major reforms since
there is an acute shortage of skilled manpower in country thus TTIB was
created.

 Due to which elimination of quotas to intense competition from china and

India, up gradation of value chain, line supervision, machinery
maintenance, factory floor performance, better technology, and research
and innovation. TTIB train youth work force according to needs of textile.
TEXTILE TARGET MARKETS

YARNS: GREY FABRICS: Dyed/Print Fabrics: HOME TEXTILES:

• China • China 1.Garmenting lands - • EU/ EFTA
Bangladesh, Laos,
• Bangladesh • Hong Kong • USA, Japan
Cambodia, Dubai,
• Mauritius • Bangladesh Bahrain, S. Africa, • Norway
China, Mauritius,
• Madagascar • Mexico • Australia
Lesotho, Kenya,
• Vietnam • Malaysia Madagascar, Sri Lanka, • New Zealand
• EU • Russia • Russia
2. Furnishings: EU,
• Mexico •Canada •Others
EFTA, USA, Norway,
• Morocco •Poland Australia, Russia, New
Zealand, Others
•Russia •Korea
•others • others
ASSISTANCE OF PRESENT
INSTITUTIONS
 To encourage the local textile industry an access to the modern 
practices in the specialized areas of manufacturing processes, 
productivity enhancement and quality control, an institutional 
mechanism should be set up which provides the industry an 
adequate and industry-friendly assistance. 
Textile Industry Training 
KARACHI
 Textile Institute of Pakistan (TIP)
 S.M.A. Rizvi Textile Institute
 Pakistan Bed Wear Design Training
Institute
 Pakistan Readymade Garment
Technical Training Institute
 Fashion Apparel Design & Training
Institute
 Institute of Textile Technology &
Management
 PHMA Institute of Knitwear
Technology
FAISALABAD
 National Textile University
LAHORE
 Pakistan School of Fashion Design
 Pakistan Knitwear Training Institute
 Pakistan Readymade Garment
Technical Training Institute
 National Textile College
 Allied College of Textile
Management & Administration
(ACTMA)
 University of Management and
Technology (UMT)
 Preston
 Iqra University
MULTAN
 College of Textile Engineering,
Bahauddin Zakaria University
 EXHIBITIONS
 National Exhibitions held annually can be very helpful in bringing out
the skills, the range of products and opportunities of group
collaboration.

 It will help the planners and large scale engineering industry in

defining the way for developing skills in order to make this sector
strong and viable.

 The interaction between the foreign textile manufacturing industry

could also be enhanced by facilitating the indigenous Textile
Engineering Industry to participate in the specialized Exhibitions and
fairs being held in those countries.
 E-commerce Gateway MoU
with Chinese Co.
 The E-commerce Gateway has signed a memorandum of understanding
(MOU) with a Chinese company Global Enterprise Consulting to launch a
business a match making' service in Pakistan and China.

 According to E-commerce Gateway Pakistan. "This service includes

seeking of agents, distributors, buyers, suppliers or joint venture partners in
Pakistan or Middle east for Chinese companies that intend to do business
in these markets".

 The service will include all kinds of facilitation required to help increase
the Chinese exports to the Middle East and South Asian markets.
 INDUSTRY SUPPORT
PROGRAM
(Textile Sector Pakistan)
 SMEDA and JICA (Japan International Cooperation Agency) have
initiated an Industry Support Program in Pakistan.

 These two organizations are working together to provide technical support

to Textile Industry in Pakistan.

 An Industry Support Cell (ISC) has also been established at SMEDA. This
cell comprises of textile professionals who have worked closely with
Japanese Experts and acquired a first hand knowledge transfer and
technical expertise.

 A total of 166 factories in different sectors of textile industry (including 33

Spinning, 41 Weaving, 30 Knitting and 54 Garment factories) received the
direct benefit of this program in all over the country.
CLUSTER DEVELOPMENT
PROGRAM
 There is an establishment of textile industry cluster in Faisalabad region of
Pakistan.

 In 2005-6 the country was the fifth largest producer and second largest
exporter of cotton yarn in the world. It was also the fifth largest exporter of
woven fabrics in the world.

 Faisalabad area has traditionally been the hub of textile industry in

Pakistan. Of the estimated 225,000 shuttle power looms installed in the
country, for weaving textile fabrics, more than half (150,000) were located
in Faisalabad district in 2003.
 In the past four decades, growth in the number of firms entering in
Faisalabad textile industry has been enormous, particularly at the small and
medium industry scale. Faisalabad also boasts the largest yarn market in
Asia.
 EFFECTS OF
GLOBALIZATION
 The globalization of Textile and APPAREL Trade has intensified during
the last three decades.

 The textile industry world over has experienced highly significant and
irreversible changes as a result of globalization of both manufacturing and
trade in the recent years. Though the demand concentrated in developed
countries the manufacturing has been shifting to the developing countries.

 Although global demand continued to grow, supply expanded considerably

more quickly.

 These changes are expected to continue and so will constitute a challenge

to the textile industry in developing countries like Pakistan.
 WTO IMPACT
 The basic fact of the matter is that with the given economic conditions and limitations Pakistan
like any developing country rely on foreign aid on one end, and the whatever is earned through
exports in terms of foreign exchange, the major chunk is paid back to the international lenders
leaving little room and money for the drastic economic growth cycle to be ignited.

 In addition, with the appreciation of dollar, or devaluation of local currency the standard of
living of an American may increase as the Pakistani goods become cheaper from him or her, but
for Pakistan this devaluation hits directly the purchasing power of a common man burring into
the cycle of poverty.

 The major impact of WTO is on textile Sector.

 The developed world has also introduced new forms of barrier like the countervailing duty, anti-
dumping duties, social, labor, and security issues. Pakistani industry will have to strive hard to
reach the requirement levels of social compliance.
 FUTURE PROSPECTS
Bright prospects ahead
 FUTURE of the textile industry in Pakistan seems bright as lots of opportunities are
available in the wake of rising world demand for textiles.

 The rise in demand is estimated at around 2.5 per cent. Thus creating greater
opportunities for the fourth biggest cotton producer country of the world.

 There are number of other factors which can contribute to the growth of industry
for instance the ban on cotton import from India has been lifted and spinners would
be allowed cotton import from India.

 It does not need to import cotton from other parts of the world which helps
decrease the cost of production as compared to other countries.

 Moreover, the textile ministry was giving training to the workers and giving
Rs2500 stipend per month to each worker and this programme was going on
successfully.
'Pakistan's New Textile Policy
Targets 40% Increase in
Exports'
 The proposed new Textile Policy (NTP) of Pakistan will help increase the
output of textile products, improve global competitiveness and generate
employment in the industry.

 The new policy targets a 40 percent increase in exports and meet the
growing domestic demand. It will help create 3.5 million new jobs.
 The first important step is to increase domestic cotton production.

 Other measures include - improvement in value addition, increase in the

number and variety of value-added products, enhancement of productivity
of manpower, stepping up efficiency of its existing plants and equipment,
and extensive use of the imported machinery.

 Five new model garment factories will be established. A textile park will be
set up to serve as a special economic zone for tax free production and
export. A weaving city will be established.
Cont…
 The financing facilities include subsidized credit and refinance facilities provided by SPB through the
commercial banks, Export Finance Facility (EFF) for textiles. The SBP has allowed swapping of costly long
term bank credit, obtained previously by the industry, with cheaper Long Term Finance for Export Oriented
Projects (LTF-EOP) for machinery and equipment.

 Pakistan plans to raise its overall exports to $ 40-45 billion by 2013, by expanding industrial, agricultural and
services sectors, including textiles.

 The proposed Textile Industry Development Policy 2007 is expected to offer four tax incentives to attract
foreign direct investment (FDI) in upcoming textile and garment cities in Karachi, Lahore and Faisalabad.

 At present, tax authorities are charging a minimum of five percent custom duty on the import of machinery.
The proposed incentives include a general sales tax exemption on utilities to those investing in upcoming
textile and garment cities. The government has already allowed general sales tax at zero rating on electricity
and gas consumed in the production process of the textile sector.

 The exports of textile products have increased by 5.27 percent at $10.757 billion in 2006-07. The government
has fixed a growth target of 12 percent for textile exports for the current fiscal year 2007-08.
 INDUSTRY POLICY
 Pakistan has shown appreciable progress in policy frame work.

 Appreciating the importance of Textile Industry and its contribution to the

economy the Government announced Textile Packages and then launched its
Economic Revival Programme backed by radical reforms in Textile Regime-
Incentives for exports – Trade Policy Investment.

 Policy and Revival of Sick Mills with the sole objective to accelerate the production
and exports.

 Efforts are in progress to pursue further structural changes in line with resources.
The new ‘Industrial Policy’ lays emphasis on ‘Foreign Investment’ in ‘Value Added
Textiles’ especially from developed countries who had been the major textile
players and still hold larger market share in international market.

 Evidence shows that a sustainable textile industry base can exist, but through
private, for-profit initiatives and investment based on economic self interest and
genuine competitive advantages.
 Incentives for foreign
Investment in Textile.
 Investment in all sub-sector of Textile Industry is permissible without any Government
permission/sanction/intervention.

 No permission of provincial Government is required for locating the unit in any area.

 Foreign Investment is permissible at 100% equity or Joint Venture with agreed terms.

 Full repatriation of capital – profits & dividends is permissible.

 No requirement of minimum investment in Textile Sector.

 Duty free import of Machinery for high technology – value added Export Industries.
 SWOT ANALYSIS
Strengths Weaknesses
• Availability of Local Cotton • Lack of a Strategic Plan
• Availability of labor • Lack of Professional Manpower
• Domestic Market • Old Plant and Equipment
• High Cost of Operation
• High Cost of Financing
• Inferior Quality

Opportunities
• Growing Demand of Textile
Products.
• Share in the international textile trade •
is less than 1%. As such, Pakistan
has an enormous opportunity to
increase its market share in the global•
market.
Threats
• Lack of Strategic Planning.
• High Cost of Operation.
Multiplicity and high rate of
taxation.
• High Cost of Financing.
Lack of Project Financing.
• Inferior Quality.
• Lack of effective support from the
Government.
 IMPACT OF CLIMATE
CHANGES IN PAKISTAN
 Climate change raises serious concerns for developing countries like
Pakistan, with its tremendous social , environmental and economic impacts.

 The agricultural productivity in Pakistan will be affected due to changes in

land and water resources.

 Although Pakistan has ideal climate condition for the growth of cotton
providing a factor advantage to the textile industry, but it is also quite
vulnerable to pesticides that can lower the yield per hector.

 The textile sector is largely dependent on the supply of raw material of

agricultural sector and hence whatever happens to the agricultural sector
like floods will adversely affect the textile industry rendering it even more
vulnerable to environmental conditions.
 ENVIRONMENTAL
HAZARDS
 From the early days of the industrial revolution, the textile industry has been seen as a
major polluter of rivers .

 The facilities of sanitation and hygiene are available to limited urban population.

 An estimated amount of 17.5 million tons of solid waste is generated every year in
Pakistan.

 The untreated water flows into stream rivers and irrigation canals.

 Deforestation is taking place in the country at a rapid pace.

 A large number of intermediate industrial processes are conducted through imported

chemicals that produce effluents and emit hazardous gasses.

 Byssinosis
 Textile processing is a water intensive process. Almost 1.08-0.15 m3of water is consumed to
produce one kilogram of finished fabric, translating into 1,000-3,000 million cube of wastewater
generation per day against a production of 12-20 ton/day of finished fabric.

 Currently the wastewater generated by the industry is discharged into the local environment
without any treatment that serious negative effect on the environment.

 A wide range of chemicals are used by the processing industry for dyeing and printing
operations. These include bleaching agents, vat dyes, azo dyes, sulphur dyes, disperse dyes and
color pigments, which are manufactured by using chemicals such as formaldehydes, hydrochloric
acid, ammonia, chromium salt, soda ash, caustic soda, sodium sulphate, sulphuric acid, etc.

 Extensive usage of these chemicals by the processing industry results in discharge of toxic
elements as effluents, which if not treated properly have the potential to cause significant
environmental degradation.

 working in a car garage or textile factory can expose a person to hazardous chemicals, dusts, and
fibers that may lead to a lifetime of lung problems if not properly diagnosed and treated.
PROBLEMS AND CHALLENGES

Lack of Infrastructure
 Under-developed weaving sector and

Lack of R & D and Training. unorganized processing units.

Inefficient industry
 Lack of international marketing

Frequent fashion changes
efforts.

Need to improve the quality of product.


Anti dumping policies imposed by major importers.  Higher rate of interest on loans for
Comparatively poor image of Pakistani brands aboard.
modernization and expansion.


Low productivity

 Less awareness in acquiring
international quality certifications.

 Cost of power is high.

 Proportion of skilled labor is very less.

 CONCLUSION
 Textile Industry is providing one of the most basic needs of people and the
holds importance; maintaining sustained growth for improving quality of
life.

 It has a unique position as a self-reliant industry, from the production of

raw materials to the delivery of finished products, with substantial value-
addition at each stage of processing; it is a major contribution to the
country's economy.

 Its has a vast potential for creation of employment opportunities.

 If Pakistan overcome all the problems, definitely we can back on the

position stands of Textile Market.
 RECOMMENDATIONS

 HUMAN RESOURCES DEVELOPMENT

 EXPORT TRADE PROMOTION
 BUREAUCRATIC PROCEDURES
 INTEREST RATES
 INFRA-STRUCTURE
RECOMMENDATIONS
 MARKET ORIENTATIONS
 HUMAN RESOURCES DEVELOPMENT
 MANAGEMENT INFORMATION SYSTEMS
 EFFICIENCIES /PRODUCTIVITY
 PRICES
 LEAD TIMES
 NEW PRODUCTS
 QUALITY CONSISTENCY
 SOCIAL ACCOUNTABILITY / LABOUR SAFEGUARDS
 Any
Questions