Project For Textile Apparel Ind Future Challenges in Pakistan

Textile & Apparel Industry, Evaluation & Future Challenges in Pakistan
INSTITUTE OF BUSINESS AND TECHNOLOGY
Textile & Apparel Industry, Evaluation &

Future Challenges in Pakistan
Prepared By
Muhammad Tauqeer Ahmad
Course Code : MKT- 606
MBA (Marketing)
FACULTY OF
MANAGEMENT AND SOCIAL SCIENCES
December 2008
Institute Of Business & Technology 1

INSTITUTE OF BUSINESS AND TECHNOLOGY
ABSTRACT SUBMITTED BY: Muhammad Tauqeer Ahmad
DISCIPLINE: MBA (Marketing)
TITLE OF PROJECT REPORT: Textile & Apparel Industry,

Evaluation & Future Challenges
in Pakistan
MONTH OF SUBMISSION: December 2008
NAME OF PROJECT SUPERVISOR:
ABSTRACT
Textile industry has been the bulwark of Pakistan's economy. It contributes
more than 60% to the total export earnings of the country, accounts for 46% of
the total manufacturing and provides employment to 38% of the manufacturing
labor force. The availability of basic raw material for textile industry, cotton, has
played a principal role in the growth of the industry.
Although the growth in the textile & apparel sector has been declining after
WTO and currently some other factors, which we’ll discuss in detail
subsequently.
The current scenario posses challenges firstly to sustain its global positioning
and secondly to increase its market share by both increase in volume as well as
increase in unit values but it’s depend upon peacefully & economical
environment and institution supports. The improvement in quality, market tie-up,
image building and change in business philosophy can be improved with new
strategy plan by Govt. and Industrial support. This requires up gradation in
resource development both in manufacturing and marketing. The focus should
be on R & D, technical innovation, product development on one hand and brand
& market development.

ACKNOLEDGEMENT
First of all I would like to thanks to ALMIGHTY ALLAH, Lord of our lives and of
everything in the universe and His Holy Prophet MOHAMMAD (P.B.U.H.),
whose blessings enable me to perceive and pursue higher ideas to making this
report possible. It was a laborious task for me and I couldn’t have accomplished
this without the help and support of many peoples.
I would like to thanks our Respected Faculty Mr. Dr. Noor Ahmed Memon, Who
gave me lot of guidance and advises in preparing this report possible.
I would also thanks to unique contribution of some capital mind from various
organization such as Gul Ahmed Textile Mills , King Apparel , Grace Knitwear,
IBC etc. which supported me to highlighted the challenges and give an abstract
ideas to how can develop our industry which going to be declining position day
by day.
Especial thanks to following, whose support and feedback was quite crucial and
without which we would not have been able to conduct the survey nor compile
this report:
 Mr. Finance Manager

 Mr. Director
 Mr. Marketing Manager
 Mr. Operation Manager
 Mr. H.R. Manager
 Mr. Production Executive
 Mr. Executive Director
 Mr. Finance & Import / Export Manager
 Mr. Merchandising / Marketing Manager
 Mr. Development Manager
 Mr. Finance & Import Manager
 Mr. Accounts Manager
I deeply grateful thanks to the staff of different industries that unconditionally

participated in this report and took out time to patiently respond to different
queries of my survey efforts.
I hope that this report meets the criteria, which I asked to adhere to.

CONTENTS
ACKNOWLEDGEMENT
ABSTRACT
Chapter: 1 INTRODUCTION 06
1.1 Introduction 07
1.2 Purpose of Study 09
1.3 Research Objectives 09
1.4 Research Methodology 11
Chapter: 2 TEXTILE INDUSTRY IN PAKISTAN 12
2.1 History of Textile Industry in Pakistan 13

2.2 Cotton 16
2.3 Ginning 20
2.4 Spinning 24
2.5 Yarn 28
2.6 Cloth 33
2.7 Made-Up Textiles 35
2.8 Hosiery & Readymade Garments 35
Chapter: 3 EXPORT PERFORMANCE 37
3.1 Over view 38

3.2 Export of Textile Manufactures 39
3.3 Problems 58
3.4 Role of the textile industry in national economy 65

Chapter: 4 WEAKNESS OF GLOBAL TEXTILE 66
4.1 Global Challenges, over view 67

4.2 Pakistan 67
4.3 India 68
4.4 China 68
4.5 Bangladesh 68
4.6 Vietnam 69
4.7 Thailand 69
4.8 Sri Lanka 69
4.9 Indonesia 70
Chapter: 5 FUTURE CHALLENGES 71
5.1 Introduction 72
5.2 Power Energy Crisis 72
5.3 Water Crisis 75
5.4 Quality Development 82
5.5 Modern Trends for the Apparel Sector 85
5.6 Emerging Challenges in Cotton Farming in Pakistan 90
5.7 Compliances Issues 104
5.8 H.R. Development 110
5.9 Post Quota Challenges 113
5.10 E-Commerce in T & A Industries 121
Chapter: 6 CONCLUSION & RECOMMENDATIONS
6.1 Conclusion 130

6.2 Recommendations 131
BIBLIOGRAPHY 142

Chapter 1: INTRODUCTION
1.1 Introduction
1.2 Purpose of Study
1.3 Research Objectives
1.4 Research Methodology

1 - INTRODUCTION
1.1 Introduction
T he textile & apparel industry of Pakistan is going towards a difficult stage

according to the elimination of quota system in 2005. Two years has been
passed away and our industry invested heavily in the previous four years to
meet the apparent global challenges faced mainly from China, India and other
Asian countries, who have been establishing a solid base in value added textile
sectors in the last few years. Despite investing more than $5.5 billion in up-to-
date textile technology our textile industry is feeling the crunch of the global
competition. Let us examine where the crux of the problem lies and how our
industry can expect to successfully pull out of the extremely difficult scenario.
The traditional spinning and weaving sectors are surviving with their exports
growing. They basically provide the raw material for the value added global
textile sector. The spinners and weavers who are complaining are those who
chose to remain in the commodity of 20 count yarn business and basic fabrics.
On the other hand, the progressive spinning mills, who invested in value added
yarns like mélange yarn or compact yarn, are reaping the benefits of the
appropriate investments they have made. On the whole, the spinning sectors is
running at full capacity and have to import about 2 million cotton bales every
year to meet the demand of yarn.
The value added sectors of knitwear, woven apparel and even home textiles,
however, are not faring so well. Particularly the knitwear sector is severely
affected by low priced, high quality products from China, Bangladesh, India and
even countries like Vietnam and Cambodia. The knitwear sector exports
amounted to $1.75 billion during 2005-2006 which is 12% of the total export
earning from Pakistan. This is by far one of the important sub sectors of our
textile industry that was until a few years ago thriving and investing in the most
modern units with the latest machinery and technology. Sadly, quite a number
of units have stopped their production because of intense competition from

other countries like India and Bangladesh. Pakistan’s knitwear industry

exported low price mass market products to department stores in the US and
Europe. Their business is highly dependent on the centralized buying houses.
One of the recent phenomenons has been the opening of the regional offices of
the department stores like Walmart in India and other countries. Indian
manufacturers have a natural advantage because of the presence of these
buying houses in India.
While there is still no dearth of export orders but the prices offered are not
feasible for Pakistani manufacturers due to high unit cost of production resulting
from higher labor cost, higher utility costs and also higher financial costs as
compared with India, China and Bangladesh. The Chinese government gives
very high export rebates to their manufacturers. In India the financial cost is
lower than in Pakistan and very attractive terms are available for new capital
investment. The knitwear units in Pakistan, that were heavily leveraged, could
not sustain the escalation in the cost of production.
The woven apparel is faring relatively better, particularly the denim sub sector.
The manufacturers in this field, like Artistic Denim, are progressive companies
who have made correct decisions at the right time. However, several denim
plants are in the pipeline in Bangladesh at present. This is a moment of
concern for Pakistan. Our manufacturers in the knitting sector cannot meet the
lower labor cost, lower utility rates and also lower import duties in the key
markets where Pakistan competes with Bangladesh. Are our denim garment
producers ready to meet Bangladesh as a viable competition in the near future?
There is a severe shortage of qualified professionals in the apparel and knit

sectors. Our trained professionals are going to Bangladesh and Russia to run
their factories. Furthermore, the quality professionals from Srilanka are not
available for our industry as in the past, because Srilanka’s apparel industry
can no longer spare its highly qualified and skillful professionals.
Pakistan’s textile industry for long had relied on quotas and rebates, resulting in
a severely handicapped outlook. The marketing was deficient as the
manufacturers were guaranteed a certain market share due to quotas. The

margins were high and comfortable. Our exporters did not invest enough in
developing brands and producing unique high quality textile goods that could
have fetched much higher returns. Although our exports have shown an
increase over the years, the unit costs of our exports have declined
significantly, reflecting lower margins and a highly competitive global
environment. Those manufacturers, who produce goods with high value
addition, are up-to-date with the latest trends and fashions and who manage to
carve a niche for themselves in the cut throat competitive world of today will be
the ones to survive in the coming years.
1.2 Purpose of the Study
This study assesses the past and current situation of Pakistan textile & apparel
industry which is the largest foreign exchange earner having 60% export share
but its struggling hard since the last fiscal year to compete in the international
markets. Further more industry also disappointed from the current trade policy
which they squeeze the incentive for the sector. So describing some selected
challenges e.g. energy crisis, cotton farming, cotton price, WTO impact etc. &
position of the industry which is not in good position so we need to be evaluate
the real picture of the industry.
I have tried my best to prepare the report in such a way so that it could cover all
the facets and figures to evaluate that what would be done and how can
improve our level and enhance our industry structure to enhance our export on
a profitable way.
1.3 Research Objective
Pakistan is one of the leading textile manufacturers in the world. However, our
value-added sectors, particularly apparel and knitted clothing have a very small
share in the world trade.
Despite efforts to bring in diversification in country's overall economic get-up the
textile sector continues to be the most important segment of the national
economy. Its share in the economy, in terms of GDP, exports, employment,
foreign exchange earnings, investment and revenue generation altogether

placed the textile industry as the single largest determinant of the economic
growth of the country.
The Apparel sector of textile Industry is one of the fastest growing areas of our
economy and has great socio-economic significance. The Apparel Industry long
the mainstay of Pakistan's economy stands at the cross roads. A combination
of factors ranging from high raw material prices to increasing competition in the
global market place is forcing both, our industrialists and our planners, to place
greater emphasis on increasing productivity and enhancing quality. Both
aspects need a significant rise in the number of trained personnel.
The objective of this my research to indicate the some viewed challenges and
would like to show the real image of the textile & apparel industry in Pakistan.
Our concerns relate to the future, towards our effort to retain our position as a
leading textile producer and to get greater market share in the coming years.
We have concerns over our ability to continue with the present rate of growth as
long as the region does not provide an even playing field.
 To assesses the overall industry structure's performance
 To get the maximum market share either in nation & international
 To Enhancing competitiveness, productivity
 Described the current position of the textile industry in Pakistan to
evaluate the situation and with the statement of this facts and figures
what could be better strategy to grow our industrial growth.
 Meet the challenges posed by WTO Regulations
 Boost Pakistan’s exports and foreign exchange earnings
 In the improvement of the industry employment opportunities would be
boosted
 To compare with global industries weakness that what the real facts to
decrease / increase our productivity growth.
 To identify the challenges of the Textile & Apparel industry now and
onward that we can evaluate our industry structure.
My objective to identify the some real facts & figures of the textile and apparel
industry just because of to analyzing the situation of the industry and in the light

of this report how can possible to get the maximum market share whilst our
industry face a large numbers of barriers to get maximize growth.
1.3 Research Methodology,
The following steps were taken to execute the study:

 A comprehensive study & research to get the maximum data from
various industrial units.
 The study was conducted with seniors capital mind of the industry with in
given time schedule from the institute.
 This report covered a large facts and figures to show the industry
performance and position from past to last year.
 To insure that provided data would be correct so get it from authentic
sources such as personally meet with D. Commissioner of Textile
industry.
 Personally conducted some interviews with managers and directors to
get their views and news from past to now.
 Secondary data was also reviewed from collecting information
 As per my experience in this industry as a Senior Merchandiser it could
be possible to add some more stuff and verify the exact situation of the
industry.

Chapter 2: TEXTILE INDUSTRY IN PAKISTAN
2.1 History of Textile Industry in Pakistan
2.2 Cotton
2.3 Ginning
2.4 Spinning
2.5 Yarn
2.6 Cloth
2.7 Made-Up Textiles
2.8 Hosiery & Readymade Garments

2. TEXTILE INDUSTRY IN PAKISTAN
2.1 History of Textile & Apparel Industry of Pakistan,
Increase in the cotton production and expansion of textile industry has been
impressive in Pakistan since 1947. Cotton – bales increase from 1.1 million
bales in 1947 to ten million bales by 2000. Number of mills increased from 3 to
600 and spindles from about 177,000 to 805 million similarly looms and
finishing units increased but not in the same proportion. It employs 50% of
industrial labor force and earns 65% foreign exchange of total exports.
Pakistan’s textile industry experts feel that Pakistan has fairly large size textile
industry and 60-70% of machines need replacement for the economic and
quality production of products for a highly competitive market. But unfortunately
it does not have any facility for manufacturing of textile machinery of balancing
modernization and replacement (BMR) in the textile mills which need to think
about joint ventures for the production of complete spinning units with china,
Italy and production of shuttle less looms (Projectile) with Korea, Taiwan and
Italy.
Textile industry has been premier industry in Pakistan and a major source of
export earning and employment. It also helps in value addition to the
manufacturing sector of the economy. During the six years between 1993 and
1998, production of yarn (in quantity terms) registered a steady annual growth
rate of 302% in Bangladesh and 405% in India. On the contrary, Pakistan
registered a growth rate of 101% per annum in yarn production although it
ranked third after China and India in the global yarn production during the same
six years. In exports, while Taiwan, India and the republic of Korea registered
an annual increase of 18.1%, 27.7% and 5.4% respectively during 1993-1998,
Pakistan registered a negative growth of 4.8% one important development was
that till 1997, Pakistan was the world’s largest exporter yarn followed by India.
However, in 1998, India gained the NO 1 position, leaving Pakistan at NO 2 In
the case of cotton cloth production, a number of Asian countries have been
emerging in the international market to compete with Pakistan. These countries
are Bangladesh, India, Taiwan, Indonesia, Thailand, Turkey, Sri Lanka and

Iran. The latest available date on overall export performance of Pakistan

comported with some regional countries is given in table 1: The above-
mentioned presentation in the context of international scenario highlights the
adverse position of Pakistan’s textile industry when is likely to continue further
following the full implementation of WTO agreement from 2005 onwards when
an era of free trade will start globally. Notwithstanding the above fact, current
stagnation in the local textile industry can be overcome through efforts,
consistent with charges occurring in the international market. It must be
appreciated that all successive governments since the birth of cotton textile
industry in Pakistan have been encouraging the textile exporters to penetrate
into new market and also to broaden the base of exportable commodities by
including value added textile goods so that reliance on exports of cotton, cotton
yarn and coarse fabrics gradually become minimal.
During the period 1973 to December 1992, some 71 spinning units with 1,136,
835 spindles, 6,600 rotors ands 7,329 looms were closed down. In 1992, a
foreign consultant form was hired by the government to look into the stagnating
conditions in the local textile industry. One of the observations of the foreign
consultant was “Pakistan has failed to make real progress in the international
market and is being over taken by many of the neighboring competitor
countries. The spinning sector, traditionally the core of the industry, is already in
the crisis with many spindles lying idle and mills being forced to close. Worse
still, this sector will be hit by the projected decline of its major markets in Japan
and Hong Kong in the coming years.”
Pakistan’s textile sector earned US$5.77 billion during the outgoing year,
compared with US$5.577 BILLION OF 2000-2001 indicating a growth of 0.69%.
“Textile vision 2005” has identified the present status and opportunities to make
in roads in conventional and hew markets and has developed sectarian
recommendations, hence the sectarian committees set up by the federal textile
Board (FTB) would play an important role be ensuring the availability of quality
raw materials on competitive prices and improvement in designing, and would
adopt quality standards and increase productivity levels. It would attract foreign
brands and promote Pakistani brands with world-class standers.

Apparel manufacture is an important value-added sector of the textile industry

of Pakistan. This sector manufactures and exports ready-made garments,
woven as well as knitted, of all types such as trousers, ladies suits, jeans,
Children garments, maxi’s, blouses, skirts etc.
There are 12,000 knitting machines, which spreads all over the country. The
capacity utilization is approx 70 percent. Besides locally manufactured
machinery, liberal import of machinery under different modes is also being
made and the capacity based on exports is being developed. This sector has
tremendous export potential. However, the sub-sector remained under pressure
from its competitors during the year under review and recorded a decline of 8.0
percent in exports as against last year amid tough competition emerging from
the newly-inducted members to the European Union (EU) belonging to the
former East European bloc.
Exports from ready-made garments and knitwear sectors crossed $1.0 billion
mark each for the first time in the history of Pakistan in 2002-03, contributing
about 30.27% to total textile and clothing exports and 52.78% to total value-
added exports. The jump in apparel (readymade garments and knitwear)
exports from $ 1,723 million in 2001-02 to $2.24 billion in 2002-03 was mainly
due to the concessions allowed by the E.U, mainly increase of quota by 15%
with effect from 01.12.2001 and abolition of import duty with effect from 2002.
However, with effect from March 2004, the E.U. re-imposed import duty @
12%. Currently, textile and clothing exports from Pakistan to E.U. are subject to
an import duty of 9.6% because these are more than 1% of the E.U. market for
textile and clothing. Consequently, these exports being ineligible for GSP
concessions have remained almost stagnant in 2003-04 and 2004-05 at about
$2.47 and $2.74 billion. In fact, textile and clothing exports from Pakistan are
under severe strain after the commencement of WTO, the World Trade
Organization, with effect from 01.01.2005. In contrast, Bangladesh and Sri-
Lanka enjoy better access to the E.U. market. The textile and clothing exports
from these countries are subject to Zero and 50% of import duty respectively as
compared to Pakistan’s textile and clothing exports.

2.2 Cotton,
Cotton is a natural vegetable fiber used primarily as a raw material for cloth.
Cotton's strength, absorbency, and capacity to be washed and dyed also make
it adaptable to a considerable variety of textile products. It grows best in tropical
and warm subtropical latitudes. Leading producers include USA, China, India,
Pakistan, Uzbekistan and Turkey. Small trees and shrubs of a genus belonging
to the mallow family produce Cotton. The immature flower bud blossoms and

develops into an oval boll that splits open at maturity, revealing a mass of long
white seed hairs, called lint, that cover a large number of seeds. When fully
mature and dry, each of these hairs is a thin flattened tubular cell with a
pronounced spiral twist and is attached to a seed. The length of the individual
fibers ranges from 1.3 to 6 cm (0.5 to 2.5 in). Shorter fibers that grow from the
seeds are called linters.
Cotton is the most used textile fiber in the world. Its current market share is 56
percent in all the fibers used for apparel and home furnishings. It is also widely
used in non-woven textiles and personal care items. It is generally recognized
that most consumers prefer cotton personal care items to those containing
synthetic fibers.
World textile fiber consumption in 1998 was approximately 45 million tons. Of

this cotton accounted for approximately 20 million tons. The earliest evidence of
using cotton as a textile fiber comes from India around 3000 BC. There were
excavations of cotton fabrics of comparable age in Southern America. Cotton
cultivation first spread from India to Egypt, China and the South Pacific. The
global rise in cotton production relates to invention of the saw-tooth cotton gin
by Eli Whitney in 1793. With this new technology it was possible to produce
more cotton fiber that stimulated new inventions in the spinning and weaving
industry. Today, cotton is grown in more than 80 countries world-wide.
Pakistan’s economy is mainly dependent on cotton and textile sector. It is,

however, realized that under the WTO post - quota scenario a larger crop
would pay the real dividends only when its quality matches the spinners’
demand at home and abroad. All the stakeholders are, therefore, being
motivated to play their due role in transforming the cotton pricing and marketing
system from subjective assessment to objective valuation of seed cotton and
lint through adoption of cotton standardization and grading mechanism already
developed and introduced by the government.
World cotton production is estimated at 118.8 million bales in 2007-08 - 3

percent lower than last world mill use is projected to increase further to 124.6

million bales thereby exceeding the production. Accordingly, the end stock is
expected to decline.
Three Asian countries (China, India and Pakistan) are expected to produce
more than half (59%) of the global cotton production in 2008-09. Similarly these
three countries are also likely to account for about 68 percent of the world
cotton consumption.
Production and Yield of Cotton,
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 Rs1,422
per 40 Kgs, as against last year‘s average price of Rs1,171. In other words
farmers received, on average, 21.4 percent higher prices this year. Similar
trend was noticed in lint cotton prices. Cotton prices in the world market have
also remained significantly higher than last year. It is important to note that the
government had previously been fixing the seed cotton intervention price and
entering the market through the Trading Corporation of Pakistan only when the
seed cotton market price fell below the intervention price. Such a necessity was
felt in 2004-05 when the government had to purchase 1.6 million bales. The
growers had availed better prices in 2005-06 and 2006-07 seasons. For the
current season (2007-08) the government did not fix any intervention price for
seed cotton, but the market prices remained firm this year.
Area, production and yield of cotton for the last five years are given in below
Table,

Cause of declining,
The cotton crop suffered for a variety of reasons including heavy rainfall in May
2007 causing poor germination in Punjab, high temperature during August and
September 2007 causing more shedding of fruit parts and pest attack,
especially dangerous mealy bug infestation. Consequently, cotton production
declined to 11.7 million bales this year from 12.9 million bales last year – thus
registering a negative growth of 9.3 percent. The wheat crop was adversely
affected by the shortage of irrigation water by 23.3 percent over normal
During the current fiscal year (2007-08), the availability of water for Kharif 2007
(for the crops such as rice, sugarcane and cotton) has been 5.5 percent more
than the normal supplies and 12.2 percent more than last year’s Kharif (see

above Table). The water availability during Rabi season (for major crop such as
wheat), as on end-March 2008 was, however, estimated at 27.9 MAF, which
was 23.4 percent less than the normal availability, and 10.5 percent less than
last year’s Rabi, adversely affecting the wheat crop, production of which has
decreased by 6.6 percent over the last year.
2.3 GINNING,
Ginning is the process for separating lint from seed cotton. Lint is the term used
for fiber after the seed has been removed at the gin. Historically the lint was
removed from the seed by hand. Eli Whitney invented the sawgin in 1793,
which was a collection of circular blades installed on a central shaft. McArthy
invented the first roller gin in 1840, which consisted of single or double rollers
covered with rough leather used to separate lint against a set of dull knives.
The ginning industry has mushroomed in the cotton growing areas of Pakistan
informally, without adequate regulation. Cotton Control Acts of Punjab and
Sindh from the 40’s era have been continuing without consequential
amendments and desperately need to be updated. Most of the industry is in the
hands of local traders who have upgraded their enterprise from mandi
commission agent operations or cotton intermediary trading by installing
sawgins. There are a few old, ginning families in Sindh and Punjab whose next
Generations have continued with the industry. By the nature of ginning activity,
as explained earlier, it is more entrepreneurial trading than a processing
activity, since the ginner has to play with the market risks of lint and cotton seed
prices. The technology deployed is primitive (from the 40’s), inefficient and
based on local manufacturing in the hands of semi-literate mechanics. Even
progressive ginners are handicapped in terms of access to technological
progress.
Pakistan is a major cotton producing country with good quality medium to
medium long staple varieties. However, as in other sectors of the economy, its
cotton sector suffers from a number of problems related to non-application of
standards, ginning practices and poor management. There are 1,221 ginning
factories in this country. The Cotton Belt is moving southward in the Punjab
over a number of years, and is also coming up in the district of Nasirabad in the

Baluchistan province, where gin factories do not exist as yet. The annual cotton
crop growing area is about 3 million hectares. The cotton crop matures first in
the Sind and then gradually up the Punjab plains. Cotton has three pickings,
where the first picking is considered the better yield pick. The third pick has the
least fiber value and is used as waste or in quilts.
Basic units and measures used in Lint Cotton are:

 Cotton Lint Bale Size 18"x22"x44"
 Bale weight 170 Kg
 1 Maund of Phutti weighs 40 Kg
 1Maund of Lint Cotton weighs 37.324 Kg
 Contamination: Human hair, shreds of clothing,
cigarette butts, Jute fibers, animal hair, polyvinyl strips, toffee wrappers
 Ginning period per year 90 to 100 days.
 Phutti required for 1 lot 100 bales: 1,300 mounds (52,000 Kg) of Seed
Cotton (Phutti) (17,500 Kg) of Cotton Lint.
 Ginning capacity in Pakistan 302,000 bales per 24 hour day
Ginning Process in Pakistan (Seed Cotton Transportation and Storage),

Seed cotton to the ginning factory is mostly transported in boras (jute bags
sewn with jute yarn) or on tractor trolleys fitted with frames wrapped in hessian
cloth and polypropylene bags sown together to form a big cotton-holder. In this
way more volume can be carried to the factory from the farm or wholesale
market. Shreds of the white colored polypropylene and the jute thread (sayba)
are sources of major contamination problem in the process of spinning and
weaving.
The seed cotton is not stored under covered sheds or proper storage facilities.
It lays open in the gin factory's or wholesale market's yard and all the dust and
trash gathers into it. Contamination such as toffee wrappers, polyvinyl bag
pieces, dust from passing vehicles finds its way into it. Also overnight dew adds
to the moisture content and causes deterioration of the color quality of cotton
fiber that effects its dyeing and finishing characteristics. For these reasons, the
Pakistani cotton quality image suffers and depreciates the
international price being fetched.

Most ginning factories buy seed cotton from the wholesalers (Aarhti) and lay it
out to dry in the sun for 3 to 4 days. The ginning factory owners pay the Aarhti,
once the rate for seed cotton has been agreed upon. The ginning factories also
contract processing for big farmers or for Aarhtis who stock up on cotton lint.
Ginning factory profits are linked to the Ginning Out Turn (G.O.T.) which is the
percentage of lint in the seed cotton.
A term called "Khoat" (trash content) is used to describe the discrepancy
between the seed cotton purchased by the gin factory and the sum of weight of
cotton lint and seed. Controlling the level of moisture in seed cotton is a major
issue. Moisture content in excess of 10% causes serious problems and
uses more electric power. Power consumption is a major cost factor during the
ginning process. Picking cotton during early morning hours is a source of
moisture, which is retained in the lint since cotton is
highly hydroscopic in nature. High level of moisture results in weakening of the
seed. The weakened seed breaks during the ginning process and its removal is
not possible.
A ginning factory basically consists of following three types of machines
a) Pre-ginning machines
b) Ginning machines
c) Post-ginning machines
Number of ginning factories and machines

**I would like to describe some more only about staple length which is most
important factor for stability of the yarn,
Fiber Length
Fiber length is the average length of the longer one-half of the fibers (upper half
mean length). It is reported in both l00ths and 32nds of an inch (see conversion
chart below).
Fiber Length Table,

2.4 SPINNING,
Spinning is the process of converting fibers into yarn. The fibers may be natural
fibers such as cotton or manmade fibers such as polyester. Sometimes, term
spinning is also used for production of manmade filament yarn (yarn that is not
made from fibers). Whatsoever is the case, the final product of spinning is
yarn.
Cotton value chain starts from Ginning that adds value to it by separating cotton
from seed and impurities, but Spinning can be called as the first process the
chain that adds value to cotton by converting into a new product i.e. conversion

from ginned cotton into cotton yarn. The importance of spinning cannot be
overemphasized. Since spinning is in the beginning of value chain, so all the
later value added processes of weaving, knitting, processing, garments and
made-ups are dependent upon this process. If spinning industry produces sub-
standard yarn, its effect goes right across the entire value chain.
INSTALLED CAPACITY BY PAKISTAN,

INSTALLED CAPACITY (in 000) WORKING CAPACITY (in 000)
Period Units Spindles Growth% Rotors Growth% Looms Growth% Spindles Growth% Rotors Growth% Looms Growth%
1948 NA 78 0 0 0 3 78 0 0 3 0
1949 NA 137 75.64 0 0 3 0 137 75.64 0 0 3 0
1950 NA 182 32.85 0 0 3 0 182 32.85 0 0 3 0
1951 NA 225 23.63 0 0 6 100 225 23.63 0 0 3 0
1952 NA 499 121.78 0 0 9 50 302 34.22 0 0 4 33.33
1953 NA 649 30.06 0 0 15 66.67 600 98.68 0 0 7 75
1954 NA 1113 4.76 0 0 23 53.33 940 56.67 0 0 13 85.71
1955 NA 1449 3.29 0 0 24 4.35 1355 44.15 0 0 19 46.15
1956 NA 1518 0.06 0 0 25 4.17 1422 4.94 0 0 22 15.79
1957 NA 1568 0.76 0 0 26 4 1447 1.76 0 0 22 0
1958 NA 1569 0.06 0 0 26 0 1459 0.83 0 0 24 9.09
1958-59 70 1581 0.25 0 0 27 3.85 1488 1.99 0 0 24 0
1959-60 72 1582 3.66 0 0 27 0 1491 0.2 0 0 26 8.33
1960-61 74 1586 12.53 0 0 28 3.7 1531 2.68 0 0 26 0
1961-62 71 1644 3.41 0 0 29 3.57 1524 -0.46 0 0 26 0
1962-63 76 1850 2.82 0 0 30 3.45 1810 18.77 0 0 26 0
1963-64 81 1913 4.52 0 0 31 3.33 1792 -0.99 0 0 28 7.69
1964-65 83 1967 -0.63 0 0 31 0 1852 3.35 0 0 28 0
1965-66 89 2056 0.24 0 0 30 -3.23 1871 1.03 0 0 27 -3.57
1966-67 94 2043 6.2 0 0 30 0 1888 0.91 0 0 28 3.7
1967-68 95 2048 10.21 0 0 30 0 1916 1.48 0 0 28 0
1968-69 100 2175 8.68 0 0 31 3.33 2090 9.08 0 0 27 -3.57
1969-70 107 2397 9.9 0 0 30 -3.23 2327 11.34 0 0 27 0
1970-71 113 2605 14.08 0 0 30 0 2491 7.05 0 0 27 0
1971-72 131 2863 2.45 0 0 29 -3.33 2650 6.38 0 0 26 -3.7
1972-73 150 3266 0.6 0 0 29 0 3057 15.36 0 0 27 3.85
1973-74 155 3346 2.64 0 0 29 0 3034 -0.75 0 0 26 -3.7
1974-75 144 3366 2.63 0 0 29 0 2823 -6.95 0 0 25 -3.85
1975-76 147 3455 1.1 2 0 29 0 2579 -8.64 1 0 23 -8
1976-77 153 3546 4.02 5 150 26 -10.34 2650 2.75 1 0 19 -17.39
1977-78 174 3585 1.39 4 -20 27 3.85 2585 -2.45 3 200 14 -26.32
1978-79 184 3729 6.66 14 250 26 -3.7 2645 2.32 13 333.33 13 -7.14
1979-80 187 3781 4.86 16 14.29 25 -3.85 2701 2.12 14 7.69 14 7.69
1980-81 203 4033 1.99 19 18.75 25 0 2833 4.89 15 7.14 13 -7.14
1981-82 210 4,229 4.86 23 21.05 24 -4 2,832 -0.04 19 26.67 13 0
1982-83 215 4,313 1.99 27 17.39 24 0 2,986 5.44 25 31.58 12 -7.69
1983-84 216 4,272 -0.99 29 7.41 23 -4.17 2,919 -2.24 23 -8 11 -8.33

1984-85 219 4,445 4.05 29 0 19 -17.39 2,872 -1.61 21 -8.7 10 9.09

1985-86 227 4,485 0.9 37 27.59 17 -10.53 3,151 9.71 25 19.05 9 -10
1986-87 226 4,356 -2.88 48 29.73 16 -5.88 3,469 10.09 40 60 8 -11.11
1987-88 224 4,393 0.85 55 14.58 17 6.25 3,607 3.98 46 15 9 12.5
1988-89 247 4,853 10.47 66 20 16 -5.88 4,026 11.62 60 30.43 9 0
1989-90 266 5,271 8.61 72 9.09 15 -6.25 4,489 11.5 64 6.67 8 -11.11
1990-91 277 5,568 5.63 75 4.17 15 0 4,827 7.53 67 4.69 8 0
1991-92 307 6,216 11.64 81 8 14 -6.67 5,333 10.48 67 0 8 0
1992-93 334 6,860 10.36 95 17.28 14 0 5,520 3.51 79 17.91 6 -25
1993-94 471 8,419 22.73 138 45.26 14 0 6,105 10.6 84 6.33 6 0
1994-95 494 8,610 2.27 132 -4.35 13 -7.14 6,262 2.57 74 -11.9 5 -16.67
1995-96 503 8,717 1.24 143 8.33 10 -23.08 6,548 4.57 80 8.11 5 0
1996-97 440 8,230 -5.59 143 0 10 0 6,538 -0.15 87 8.75 5 0
1997-98 442 8,368 1.68 150 4.9 10 0 6,631 1.42 80 -8.05 4 -20
1998-99 442 8,392 0.29 166 10.67 10 0 6,671 0.6 66 -17.5 5 25
1999-00 443 8,477 1.01 150 -9.64 10 0 6,825 2.31 66 0 4 -20
2000-01 444 8601 1.46 146 -2.67 10 0 6913 1.29 70 6.06 4 0
2001-02 450 9060 5.34 141 -3.42 10 0 7440 7.62 66 -5.71 5 25
2002-03 453 9260 2.21 148 4.96 10 0 7676 3.17 70 6.06 5 0
2003-04 456 9592 .3.59 146 -1.35 10 0 8009 4.34 66 -5.71 4 -20
2004-05 458 10485 9.31 155 6.16 9 -10 8492 6.03 79 19..70 4 0
2005-06 461 10437 -0.46 155 0 9 -11.11 9415 10.87 77 -2.53 4 0
Source : APTMA
(a) WORLD BASIC STRUCTURE DATA
Spinning Weaving
Shuttleless
Ring Spindles O-E Rotors Looms Shuttle Looms
COUNTRY 2004 2005 2004 2005 2004 2005 2004 2005
Argentina 1,500,000 1,600,000 40,000 43,000 5,500 5,580 17,300 17370
Australia - - - - - - - -
Austria 185,284 176,864 17,248 15,108 - - - -
Belgium 32,208 32,208 15,804 15,804 - - - -
- - - - - - - -
Beazil 4,498,900 4,593,900 327,150 332,750 39,390 40,590 12,000 -
Czech
Republic 272061 222160 47944 44879 5511 5068 268 218
422341 368606 50064 46999 6862 6451 792 732
Egypt 2180000 2150000 38000 31000 3500 3500 3600 3000
France 80000 - 48000 - 3300 - 200 -
Germany 306900 266166 23770 18533 1800 1750 550 510
Greece 692000 682000 17500 17500 50 55 2000 1950
Hungary 88912 - 3560 - 274 238 - -
India 37470358 - 501143 520908 9631 - 103281 -
38494598 37517082 - - 14058 15602 110509 75705
Italy 1298460 1204971 79405 71465 10420 9524 1460 1334
Japan 1992000 1803000 51000 46000 14420 13365 18947 16942

2441000 2219000 51000 46000 37990 36182 44815 41341

Korea , Rep 1574512 1273856 15012 13668 1224 841 - -
Morroco 450000 - 40000 - 2100 - 4000 -
- - - - - - - -
Nigeria 700000 700000 27000 27000 2500 2500 11000 11000
Pakistan 9743483 9815000 150696 155000 25000 26000 225000 275000
Portugal - - - - - - - -
860100 - 36200 - 9050 - 1500 -
South Africa - - - - - - - -
288505 241800 35324 22000 2506 2043 - -
Spain 421564 223438 53060 48190 4814 4625 1203 1157
Srilanka 150000 - - - 1500 - 10000 -
Switzerland 161000 104650 - - 740 610 50 30
Taiwan R.O.C 1995724 1968117 72553 69486 12897 12089 612 521
- - - - 34388 30021 909 818
Turkey 6312339 6418744 543318 552634 - - - -
- - - - 34500 36500 20000 20000
USA 1597000 1430000 576000 502000 - - - -
26000 - 1447 -
(b) Growth of Spinning Industry in Pakistan
Pakistan’s spinning industry maintains a long history. At the time of

independence, where many of the industries were non-existent in the country,
spinning industry did exist. Total number of spindles in the country was 78,000.
This number grew to 2.4 million till 1970. During this time, major growth took
place during the period 1952-56. From 1970 onwards, the growth trend was
steady. The growth of Pakistan’s Spinning industry during the period 1970-99 is
shown in Figure 3.5.2. Number of units has grown from 107 in 1970 to 442 in
1999. This represents an average growth rate of 5.3%. The growth was steady
till 1993 after which a sharp increase can be seen with number of units growing
from 334 to 471 during the period 1993-94. The increasing trend continued till
1996 followed by a sharp decline from 503 to 440. Good cotton crops in the
early nineties attracted the investors towards spinning business. But two
Consecutive crop failures in 1993 and 1994 created a shortage of cotton in the
country resulting in an excess capacity build-up in the industry that led to
closure of many units.
A Large numbers of mills has been closed which will be discussed in
subsequently.

PROVINCE-WISE CAPACITY EVALUATION (Updated 2007)
INSTALLED: SINDH PUNJAB N.W.F.P. BALUCH. TOTAL KASHMIR G.TOTAL

SPINDLE 2132310 7348510 812480 126800 10420100 93696 10513796
ROTOR 64487 79052 200 14016 157755 0 157755
LOOMS 3318 4121 160 100 7699 0 7699
WORKED:
SPINDLE 1369882 6925503 729835 91975 9117195 64036 9181231
ROTOR 25861 38539 200 9397 73997 0 73997
LOOMS 957 2514 0 0 3471 0 3471
STOPPED POSITION
SPINDLE 762428 423007 82645 34825 1302905 29660 1332565
ROTOR 38626 40513 0 4619 83758 0 83758
LOOMS 2361 1607 160 100 4228 0 4228
SOURCE: Textile Commissioner Org.
2.5 YARN
Pakistan is at number four positions in world’s cotton yarn production with 8%

share. Its production grew at an average rate of 4.9% for the period from 1990
to 1999. This growth figure is very healthy considering the average global yarn
production growth rate of 0.53%. it is only slightly lower than India’s growth rate.
About half of total yarn production in the 1970s came from the Punjab province.
Its shares have increased since then. At present, more than 70 percent of yarn
production occurs in Punjab (Table below). Conversely, the share of total yarn
production in Sindh declined from 43 percent in the 1970s to about 20 percent
at present. Sindh’s share of yarn production has declined because of the
relocation of installed capacity to the Punjab province, as described earlier .

Less than 10 percent of yarn production comes from other provinces, mostly
from the Northwest Frontier Province and the Balochistan province. However,
the Balochistan industry has been closed since 1983 after working for only a
couple of years as a joint venture with Iran. The Balochistan industry that was in
the public sector has been liquidated since then and is now on the privatization
list. Because cotton is a determinant of the incomes for the poor, the closure
meant an increase of poverty The provincial disparities in cotton growing and
processing have important poverty implications. Since the bulk of cotton
production and processing is in Punjab and Sindh, farmers and the rural areas
in these provinces have the edge in terms of income generation over the rest of
the provinces.
Over the period 1990–2005, the production of yarn in Pakistan (cotton and man
made) increased at an average annual rate of 4.7 percent (Table 4.9). This is
astonishing growth, as it was achieved under conditions of political instability.
The share of exports of yarn increased from 29 percent in the 1970s to 47.5
percent in 1991–1992, but started to ease since this peak. In 2004–2005, the
share of exports of yarn declined to 26.5 percent. Some of the major

international markets for Pakistan cotton yarn in recent years include Hong
Kong, China, United States, and South Korea (Table below).
Pakistan is a major producer of cotton yarn. Table 4.11 shows that its share in
the world production has increased from 7.2 percent in 1994 to 9.1 percent in
2004, which is slightly lower than the share of India (9.7 percent) and greater
than the share of the United States (5.8 percent). However, it is considerably
lower than the share of Mainland China (46.8 percent).
The spinning industry of Pakistan produces most of the counts of yarn, but it is
heavily tilted toward low counts,15 which are of relatively low value. Table 4.12

presents the count structure of cotton yarn production. In the 1970s, 57 percent
of cotton yarn produced was coarse count: 23.2 percent in the 20s, 16.4
percent in the 10s, and 9 percent in the 16s. There were some within the
medium count, mostly in the 21s. Except for the decline in the share in the
1980s, the share of cotton count 20s slightly increased in the 1990s and at
present. The share of cotton count 30s also improved slightly over the period.
However, the share of cotton count 21s declined as well as the share of cotton
count 10s. Below Table shows the historical data of the world export of yarn
(cotton and man made). It includes data on value (billion $), volume (million
tons), and export unit price ($/kilogram) of the world as a whole and a few
selected major yarn-exporting countries including Pakistan. The annual export
unit price of Pakistan yarn is below the world average. It is also below the
annual export unit price of the rest of the yarn-exporting countries included in
the list. Over the period 1990–2006, the average export unit price of Pakistan
yarn was $2.3/kilogram. The average world export price is $3.4/kilogram.
UPDATED CONSUMPTION OF RAW COTTON AND YARN to 2007
PROVINCE-WISE CONSUMPTION OF RAW COTTON , PRODUCTION OF

YARN During The Month of JUNE 2007

RAW COTTON CONSUMPTION (IN PRODUCTION OF YARN (IN 000

PROVINCE 000 Kgs.) Kgs)
COTTON FIBRE TOTAL COTTON BLENDED TOTAL
SINDH 42670 3923 46593 32812 2816 35628

PUNJAB 139557 25706 165263 100245 19502 119747
N.W.F.P 5281 4434 9715 6865 2011 8876
BALUCHISTAN 5584 467 6051 4338 396 4734
TOTAL 193092 34530 227622 144260 24725 168985
A.KASHMIR 494 89 583 354 230 584
G.TOTAL 193586 34619 228205 144614 24955 169569
PRODUCTION OF COUNT - WISE YARN WITH PERCENTAGE

(000 KGS.)
COUNT 2004 - 2005 2005 - 2006 2006 - 2007

COARSE QUANTITY %AGE QUANTITY %AGE QUANTITY %AGE
1-9s 118346 5.67 131885 5.95 140648 6.28
10s 153753 7.37 153588 6.93 159842 7.13
12s 75432 3.61 88650 3.99 93592 4.18
14s 39349 1.89 43683 1.97 55728 2.49
16s 163019 7.81 170993 7.71 170297 7.6
18s 56506 2.71 43209 1.95 67983 3.03
20s 397231 19.03 413364 18.65 376494 16.8
Sub. Total 1003636 48.09 1045372 47.15 1064584 47.5
MEDIUM
21s 72717 3.48 71533 3.23 75108 3.35
24s 80572 3.86 75496 3.4 92589 4.13
28s 47678 2.28 55336 2.49 76493 3.41
30s 180163 8.63 191297 8.63 190813 8.51
32s 58614 2.81 65968 2.97 79798 3.56
34s 17799 0.85 20078 0.92 32649 1.46
Sub. Total 457543 21.91 479708 21.64 547450 24.43
FINE
36s 18391 0.88 19864 0.9 25752 1.15
40s 58877 2.82 74103 3.34 91448 4.08
47s 14486 0.69 8013 0.36 24343 1.09
Sub. Total 91754 4.39 53756 2.42 141543 6.32
SUPER FINE
48s 8982 0.43 12845 0.58 16678 0.74

60s 10280 0.49 17089 0.77 34622 1.54

80s 18744 0.9 23822 1.07 29305 1.31
Sub. Total 38006 1.82 53756 2.42 80605 3.6
P. Viscose 90833 4.35 95671 1.64 81082 3.62

P. Cotton 378032 18.11 403860 18.22 259176 11.56
Sub. Total 468865 22.46 499531 22.54 340258 15.18
TOTAL 2059804 98.68 2180347 98.36 2174440 97.02
WASTE 27483 1.32 36255 1.64 66706 2.98

G.TOTAL 2087287 2216602 2241146
Non Listed Units 203053 339695 486409

TOTAL YARN 2290340 2556297 2727555
Source : Textile Commissioner organization
2.6 CLOTH
The textile industry of Pakistan has traditionally relied on the manufacturing of
pure cotton fabric. Whereas the global mill consumption is rapidly moving
towards the usage of a diverse range of staple fibers and artificial and synthetic
filaments. This is also reflected in Pakistan's export of woven fabric, where
Pakistan accounts for almost 7% of the world exports in cotton and blended
fabrics. On the other hand its share in manmade fabric exports is limited to 2%
only.
Cotton Cloth
While the production of cloth in mill sector is reported, the same is not true with
production of non-mill sector. Output of the non-mill sector is estimated
although its output is seven times more than the mills sector.
The production of cloth, both from mills and nonmills sector have registered a
growth of 2.7 percent during July-March 2007-08 (see below Table). This sector
showed growth and thus served as the main strength for down stream
sectors like bed wear – made-up & garments. However, it recorded somewhat
negative export growth for July-March 2007-08 (- 11.0%) as compared to 2006-
07. This decline in exports can largely be attributed to increasing cost of
production due to shortage of cotton in the local market, increased wages

of unskilled workers, massive power cuts, rising international competition and

poor infrastructure have made the local manufacturers and exporters’ non-
competitive in the international market. Meanwhile, Pakistan’s competitors e.g.,
China, Bangladesh, India and Sri Lanka are aggressively marketing their
products and are more competitive in the international market than Pakistan
(7.3%) as compare to last year. Currency differentials between India (Pakistan’s
traditional rival in this sector) and Pakistan as well as increased stress on
quality control, played favorable for the country and diverted more orders
towards Pakistani garment exporters.
Installed and Used Capacity in Weaving Sector
2.7 Made-up Textiles

The pattern of cloth production is different than spinning sector. There are three
different sub-sectors in weaving , integrated, independent weaving units, and
power loom units. Investment has taken place in shuttle less
Production of Cloth (M. Sq. Mtrs)

2.8 Hosiery & Readymade Garments
The hosiery and knitwear industrial network comprises 3,500 large, medium
and small units, 85% of which are small enterprises, 10% medium ventures and
only 5% large integrated factories. the industry provides jobs to 700,000 people
in an environment dominated by redundancies and downsizing in giant
multinationals, foreign banks and big corporations.
The industry sustains directly, livelihood of 210,000 skilled workers and their
families; 490,000 unskilled workers and their kith and kin. Another 350,000
people benefit in allied cottage industries. Thus the industry provides directly
and indirectly sustenance to well over a million people.
Despite being a labor -intensive industry, the investment in the knitwear and
hosiery units is estimated at rs. Seven billion and tops the list of industries for
value added exports ranking as the second largest foreign exchange earner in
the country.
Knitwear exports consist of knitted and processed fabrics knitted garments;

knitted bed sheets, socks etc. and has the largest share of the nation's textile
exports. it is a pride to mention here that all the exports of all the above knitted
products is 35 % of the nation's exports. the knitwear industry consequently
emerges as the countries top foreign exchange earner.
There are about 12,000 knitting machines spreads all over the country. The
capacity utilization is approx 70 percent. Besides locally manufactured

machinery, liberal import of machinery under different modes is also being

made and the capacity based on exports is being developed. This sector
has tremendous export potential. However, the sub-sector remained under
pressure from its competitors during the year under review and recorded a
decline of 8.0 percent in exports as against last year amid tough competition
emerging from the newly-inducted members to the European Union (EU)
belonging to the former East European bloc.
Readymade Garment 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; however, large units are now coming up in the
organized sector of the industry. 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
the falling export of textile products. Assassination of Ms Bhutto in December
brought to halt not only the industrial activities but huge number of export
shipments could not make their way to the sea ports because of strikes and
unavailability of cargo transport compelling importers of Pakistani products
to divert their orders to other destinations.

Chapter 3: EXPORT PERFORMANCE
3.1 Over view
3.2 Export of Textile Manufactures
3.3 Problems
3.4 Role of the textile industry in national economy

3. EXPORT PERFORMANCE,
3.1 Over view,

Overall exports recorded a growth of 10.2 percent during the first ten months
(July- April) of the current fiscal year against a growth of 3.6 percent in the
same period last year. In absolute terms, exports have increased from $
13847.3 million to $ 15255.5 million. However, all the major components of
textile manufactures were up substantially but exports in quantum term
registered a sharp decline across the board with exception of raw cotton. In
other words Pakistan’s textile exports could not benefit from higher international
prices and as such the exports performance of this sector has been dismal in
2007-. The dismal performance of textile exports can be attributed, beside their
structural issues, to rising cost of production owing to increase in domestic
cotton prices and stifling power shortages. In addition, the deteriorating law and
order situation in the country also resulted in reported diversion of export orders
to other countries. Poor quality of cotton on account of contaminated cotton
issue has also adversely affected the export of spinning industry.
Furthermore, textile exports appear to have also suffered from the slow down in
the US economy that has been the largest destination for Pakistani exports
during the last few years. In addition, Pakistan also faced tough competition
from China, India, Bangladesh and Turkey in the EU market for textile apparel.
In the case of bed wear exports; its exports to EU market are rising after the
reduction of anti-dumping duty on this category from the previous level of 13.1
percent to 5.8 percent.

3.2 Exports OF Textile Manufactures

However, in the US market, this category of export faces tough competition in
terms of prices, especially from China. Export of petroleum group accounting
for 6 percent of total exports contributed 18.2 percent in the overall exports
growth for the year. Export of petroleum product and Naphtha registered an
impressive growth of 83 percent and 16 percent respectively.
Unlike textile manufactures, exports of other manufacture accounting for 19
percent of total exports posted a stellar growth of 33.2 percent in the current
fiscal year. Accordingly, it contributed over 50 percent to this year overall
exports growth. The major performers under this category of exports include
leather tanned; leather manufacturer; surgical goods; chemical and
pharmaceutical products. The performance of carpets & rugs and engineering
goods has been lackluster as they registered negative growth. All other
manufactures under this category of exports Export of all other items
accounting for over 5 percent of total exports grew by almost 60 percent and
accordingly, contributed 20.6 percent to this year’s overall exports growth. (see
below Table).

moving away from conventional textile products to new non-conventional items

such as other manufactures, petroleum product and food group (see figure 8.1).
However, the pace of diversification is painfully slow. The current food price
hike at the global and national level provides window of opportunity for
Pakistani farmers to of the major exporters of rice and wheat, therefore,
contributing substantially to overall export growth. the major export commodities
are given in Table


Share of cotton yarn and cotton cloth has also witnessed a decline. However,
the shares of other categories of textile exports such as ready made garments,
synthetic textile and made up articles have shown a marginal increase during
the first nine months of current fiscal year.
Pakistan’s economy lacks is the export of high technological products and

software
Cotton,
Textile and Apparel as defined by TDAP, for purposes of this analysis, includes
all products starting from raw cotton and ending up with even cotton waste
inclusive of tents and canvas. It, of course, includes products made from cotton
and manmade yarn and fiber.

Total T&A exports for six months ending December 2007 were US $5.2 billion.
These were US $280 million less than last year ie 5%. Of the total exports of
US $5.2 billion, countries where exports increased accounted for US $2.7 billion
ie almost half. The balance exports of US $2.5 were from countries where
exports declined.
All countries where exports were higher, produced a combined increase of US

$128 million. Those countries which reflected a decline generated a total
decrease of US $408 million resulting in the net decline of US $280 million. On
a total T&A basis, the countries generating the major part of the above
increases of US $128 million were Italy US $20 million, Turkey US $30 million,
Netherlands US $18 million and a host of non traditional markets ("others") that
jointly produced increase of US $21 million. It is noteworthy that the non-
traditional markets generated US $21 million out of the total increase of US
$128 million. This reflects the efforts being made by the exporters, supported by
TDAP, to venture into new markets. Of the decline in exports of US $408
million, the major countries pulling down Pakistan's exports were USA US $311
million, Hong Kong US $49 million, Saudi Arabia US $12 million and China US
$10 million.
It is however, noteworthy that on a total T&A basis, an actual decline over last
year was seen only in a total of nine countries. In all other countries, exports
were either equal or higher than last year. However the largest declines in the
US, China, Canada and Hong Kong could not be made up by the growth in the
rest of the world.
This clearly reflects that Pakistan is not competitive and serious attention needs
to be paid to this primarily by the government (for short term support) and the
private sector (for both short and long term). Whether we like it or not the fact is
that today Pakistan's GDP growth, export levels, trade deficit, foreign exchange
reserves, local investment in (trail-blazer for FDI), employment generation,
revenue generation welfare of the farming community, welfare of the women
employed in the rural areas and indeed the overall national economic activity
are all seriously dependant upon the textile and garment sector. A lot has been

done to address the issues and leverage the opportunities but a lot more is
required. Question is not 'whether Pakistan can afford to, the question is
'whether Pakistan can afford not to'!
There is no doubt that during 1999 to 2005 when exports of T&A were growing
at a fast pace (8 years increase of over US $5 billion!) and returning revenue
and cash flows to the government and the industry, fundamental issues could
not be completely addressed.
These are need for increase in cotton production, minimizing cotton

contamination, improved growing capacity and technology, standardization of
cotton, new cotton seed development through research, incentives etc to the
value added sectors, increase in scale of production in garments, training of
human resource, use of ICT in industry, JVs and FDI for technology, marketing
and better management. Today, with earnings not increasing and government
revenues under pressure to invest further behind these, albeit essential, feels
painful to both the government and the private sector.
The above analysis is for all textiles and apparel. Within this large export sector
there are various product groups such as cotton, yarn, fabric, garments, bed
ware, towels etc. The export increases and decreases by country, in each of
these country and product groups are significantly different. The analysis that
follows is therefore product group wise.
RAW COTTON:
Exports for six months ending December 2007, were a total of only US $20
million. These were US $4 million lower than last year ie 18%. Exports made
were primarily to China of US $2 million, Myanmar US $0.7 million, Bangladesh
US $7.5 million, Indonesia US $5 million. It may be noted that exports to China
and Myanmar (last year were virtually nil) and that exports declined to
Bangladesh and Indonesia by 19% and 41% respectively.

Raw Cotton (July-June 02-03 to July-June 06-07)
140,000 $1,400.00
120,000 $1,277.80 117,084 $1,200.00

$109,957
$1,087.00 1,149.41
100,000 $1,114.00 $1,000.00
$939.13
$889.58
80,000 $68,151 $800.00
62,658
60,000 55,100
$49,016 $600.00
$50,226
$47,671 46,328
45,065 40,306
40,000 37,307 $400.00
20,000 $200.00
0 $0.00
Jul-Jun 02-03 Jul-Jun 03-04 Jul-Jun 04-05 Jul-Jun 05-06 Jul-Jun 06-07 Mar-Feb 07-08
Quantity (000) MT Value ('000') AUP (MT)
COTTON YARN:
Total exports for six months ending December 2007 were US $673.5 million ie
7.8% of Pakistan's total exports. Compared to last year these were US $28.2
million or 4.0% lower.
Exports increased over last year to Turkey US $28.8 million or 151%, Bahrain
US $8.0 million or 382%, Portugal US $6.2 million or 17.6%, Bangladesh US
$4.6 million ie 13%, Netherlands US $4 million ie 225%, Germany US $2.2
million or 161%, Belgium US $2.1 million or 67%, Vietnam US $2.0 million or
75%, Philippines US $1.7 million or 62%, UAE US $1.5 million or 62%.
However, decreases outweighed the increases and export over last year
declined in USA US $24.4 million or 52%, Hong Kong US $24 million or 12.5%,
China US $11.9 million or 7.6%, South Korea US $6.3 million or 13.6%, Japan
US $3.5 million or 12.9%, Egypt US $2.5 or 24%, Indonesia US $3.7 million or
40%, Brazil US $2.7 million or 61%, Austria US $2.7 million or 99.9%. Net of
the increasing and decreasing countries, total exports were US $28.2 million or
4% lower than.

Nil exports compared to last year were made to Yemen, Iraq, Kuwait, Russia,
Denmark, North Korea, Sweden, Ireland, Qatar, Norway and a few other
countries.
YARN OTHER THAN COTTON YARN:
The product range included here is cotton yarn mixed with manmade fibre and
filament yarn etc. Total exports were US $25.5 million which were US $7.1
million lower than last year ie a decline of 21.9%.
Significant increases in value were achieved in Turkey US $1.6 million or 91%,

South Korea US $1.3 million or 223%, Brazil US $787K (Nil last year),
Bangladesh US $676K ie 39%, Sri Lanka US $552K or 90%. Other countries
where exports also increased by US $l00K to US $150K were Portugal,
Philippines, Argentina and Kenya.
In terms of trends, significant percentage increases were achieved in Argentina

(5600%), Australia 1666%, Hungary 4100%, Denmark 1600%, Morocco 49%.
Significant decline in exports was experienced in India US $3.2 million or 100%,

Hong Kong US $1.5 million ie 66%, China US $1.3 million ie 79%, Iran US
$829K ie 74%, Bahrain US $698K or 87%, Italy US $667K or 65%, Egypt
US$479 ie 7 1%, Germany US $436K or 83%. Other countries of a decline
between US $100 to US $315K were Afghanistan, Canada, Austria, Belgium,
Japan, Saudi Arabia, UK, Mauritius, and France. It is noteworthy that in all
countries where exports declined, the percentage declines were high which
suggests sudden decline in demand. Besides countries to which zero exports
could be made compared to last year were Austria, Malaysia, Russia,
Myanmar, Algeria, Thailand, Poland, Oman, Azerbaijan, Czech Republic,
Qatar, Switzerland, Greece, Jordan, New Zealand, Romania and few others.
Exports to these countries last year were small but nil exports suddenly to a
large number of countries is note worthy.

COTTON FABRIC:
This included fabric greige and dyed finished but made of cotton only. Does not
include made up items of fabric such as bed sheets, etc. Total exports were US
$905 million that was a decline of US $89 million over last year or 9%.
Countries where significant growth in export value was achieved were (and
note the high percentage increase in some cases), Italy US $7.9 million ie 14%,
Russia US $6 million ie 42%, Brazil US $4.4 million ie 120%, Ukraine US $4.4
million ie 144%, Belgium US $3.7 million ie 14%, Spain US $2.8 million ie 9%,
Romania US $2.6 million ie 247%, Netherlands US $2.4 million ie 16%, Finland
US $2.2 million ie 46%, countries with increases of US $1 to US $2 million were
Portugal, Egypt, Mexico, France, Estonia, Bahrain, Latvia and Azerbaijan.
Countries reflecting significant percentage increase trends were Russia 42%,

Brazil 120%, Ukraine 143%, Finland 46%, Bahrain 51%, Romania 247%,
Lebanon 50%, Latvia 369%, Czech Republic 121%, Azerbaijan 1838%,
Afghanistan 508%. Against nil exports last year, exports were achieved in
Myanmar, Maldives and Uzbekistan this year.
Countries where export declined were significant were US $35.4 million ie 36%,
Hong Kong US $21.5 million ie 42%, UAE US $12.8 million or 40%, Sri Lanka
US $9.7 million or 18%, South Africa US $7.3 million ie 26%, UK US $7.0
million ie 22%, India US $6.8 million or 23%, Saudi Arabia US $4 million ie
29%, Indonesia US $3.6 million ie 64%, Canada US $3.4 million ie 46%; other
relatively significant countries where exports declined by between US $1 million
to US $3 million were Turkey, Australia, Jordan, Japan, Norway, Niger,
Philippines, Qatar, Nigeria and Iraq.
THE COMPARATIVE PERFORMANCE OF THE YEARS , 2004-05 , 2005-06,

2006-07, (JULY-JUNE)
%
INCRE/DECR.
2004-05 2005-06 2006-07 (2006/2007)
PRODUCTION (M.BALES)

RAW COTTON 14.347 12.395 12.4111 0.13

CONSUMTION (000KGS)
RAW COTTON 2124408 2407560 2584428 7.35
M.M.FIBRE 498416 525000 580000 10.48
TOTAL 2622824 2932560 3164428 7.91
IN BALES OF 170KGS 15428377 17250353 1861428 -89.21
PRODUCTION (000 KGS)

COTTON YARN 1770340 2006299 2039056 1.63
BLENDED YARN 520000 550001 688500 25.18
TOTAL 2290340 2556300 2727556 6.7
CONSUMPTION OF YARN
MILL SECTOR (000 KGS) 105362 95710 104423 9.1
PRODUCTON (000
SQ.MTR.)
COTTON CLOTH 842292 862983 951819 10.29
BLENDED CLOTH 82380 52273 61100 16.89
TOTAL 924672 915256 1012919 10.67
NON MILL SECTOR 6192000 7069500 7682738 8.67
G.TOTAL 7116672 7988699 8695657 8.85
EXPORT (IN 000)

RAW COTTON IN KGS. 117084 63025 45069 -28.47
YARN IN KILOGRAM 504722 694526 674841 -2.83
CLOTH IN SQ.MTR. 2399458 2625174 2211182 -15.77
CAPACITY INSTALLED IN JUNE

LPINDLE 10906068 11168780 11265954 0.87
ROTOR 202356 199520 188328 -5.61
LOOM 9322 8747 7899 -9.69

CAPACITY WORDED
(AVG.)
SPINDLE 8816850 9631304 10057623 4.43
ROTOR 122477 122168 113728 -6.91
LOOM 4705 4205 4252 1.12
KNITTED CROCHETED FABRICS:
Products included are all kinds of knitted fabric but not made ups of knitted
material. Exports at US $32.8 million were US $2.8 million more than last year
or 9%. Significant countries remaining lower than last year were the USA US
$2.2 million ie 50%, UAE US $2.1 million or 48% and Jordan US $1.0 million or
45%.Significant increases in countries that more than offset the decreases were
achieved in Sri Lanka US $2.3 million ie 72% and India US $1.0 million ie
320%.
READYMADE GARMENTS:
Products included here are all kinds of readymade garments made from woven
material for men, boys, girls, ladies but do not include garments made from
knitted material (such as housing, T-shirts etc). Garments made from cloth
made of manmade fiber are also included here.
Exports at US $714 million were 8.2% of total exports of Pakistan (last year
9.6%). Exports declined over last year by US $93.5 million or 11.6%.
Exports increased in 35 other countries as well but in dollar term these

increases were less than US $500K in any one country. Some high growth
trends were seen in Brazil 178%, Hong Kong 38%, Japan 64%, Argentina 51%,
Lithuania 920%, Algeria 280%, Russia 73%, Ukraine 274%, Estonia 1023%,
Latvia 126%, Kenya 55%, Lebanon 767%, Egypt 680%, Libya 1000%, Malta
80% and Zimbabwe 150%. This reflects the exporters search for new markets
as the traditional US and EU markets become more competitive.
Major declines in exports were seen in the USA of US $76 million or 21%, UK
US $5.6 million or 6%, Belgium US $11 million or 33%, Saudi Arabia US $3.2

million or 33%. Exports declines of around US $1 million to US $2 million were

seen in Ireland, Sweden, Canada and France. Minor declines were seen in over
40 other countries. Significant decline trends in percentage terms were seen in
Singapore 68%, Luxembourg 99.7%, Kuwait 78%, Oman 54%, Switzerland
55%, Mexico 49%, Sri Lanka 53%, Nigeria 97%, India 80%, Iran 68%, Bahrain
58%, Afghanistan 96%, and few others.
KNITWEAR:
The product range covered is jackets, blazers, men/boys knitted trousers,
shirts, T-shirts, track suits, socks, gloves and other knitted garments of cotton,
wool, artificial synthetic and other fibers, etc.
Total exports for six months ending December 2007 at US $936 million were
11% of total Pakistan exports (last year 11.5%). These were US $30 million
below last year ie 3%. Combined export value of all countries where exports
declined at US $693 million, was much more than the combined export value of
countries where exports increased ie US $242 million.
Of countries where exports were less than last year the total decline was US
$65 million. Of this USA alone declined by and US $46 million ie 7.3%,
Netherlands US $8 million ie 17.7%, Spain US $2.6 million ie 8% and Hungary
US $2.5 million ie 54%. All other countries that declined were lower than last
year by less than US $450K each.
Of countries where exports were higher than last year, Germany led the growth
and increased by US $7 million ie 23% followed by Italy US $5.7 million ie 19%,
UAE US $5.5 million ie 65%, UK US $3.8 million ie 5%, Belgium US $2.3 million
ie 12%, France US $1.7 million ie 11%, Saudi Arabia US $1.6 million ie 62%,
Norway US $1.0 million ie 166%, Sweden US $1 million ie 32%. All other
countries were exports where higher than last year produced an increase of
less than US $500K in anyone country.
Some noteworthy trends in percentage term were Ireland 20%, Mexico 35%,
Australia 20%, Sri Lanka 28%, and Switzerland 56%. More than 30 countries

were where exports increased over last year and where exports were more
than US $1 million. With increasing competition in the traditional markets, this
reflects the exporters efforts to seek new markets such as Poland, Qatar,
Estonia, Russia, Argentina, Azerbaijan, Slovenia, Bahrain, Senegal, Morocco,
Kyrgyzstan, Cyprus, Egypt, and Iraq etc. TDAP continues to support these
efforts with organized delegation and higher level of participation in exhibitions.
MADE-UPS OF TEXTILES:
The product range covered includes sanitary towels, napkins, dishcloth, wash
cloth, bar mops, other cleaning cloth, bath mats and curtains etc. It does not
include bed ware, pillow covers, towels etc.
Total exports for the 6 months ending December 2007 were US $255 million ie
3% of Pakistan's total exports and about the same as last year. These exports
increased over last year by US $17.9 million ie 7.5%. Of the total net exports of
US $255 million, countries where exports increased had a combined export
value of US $233 million and those where exports declined were a total of US
$22 million.
Export value of countries where exports grew was much more than export value
of countries where exports declined.
In the countries where exports increased, the total increase was recorded at US
$24 million. Of this US $24 million, significant increases were in USA US $7.4
million ie 5%, UK US $6.8 million ie 20%, Germany US2.0 million ie 25%,
Netherlands US $1.3 million 30%, South Africa US $1.4 million ie 82%, UAE US
$1.0 million ie 33% and Australia US $0.8 million ie 35%. There were 43 other
countries where exports increased but no one country exceeding an increase of
US $500K. Some significant trends in percentage growth term were Poland
19%, Greece 37%, Kuwait 74%, Portugal 48%, India 130%, Brazil +678%.
In countries where exports declined the combined decline was US $6.0 million.
This was mainly because of Italy US $1.2 million ie 12%, France US $1.2

million ie 22%, Spain US $0.6 million ie 18%. Some other significant declines in
percentage terms were Ireland, Australia, Malaysia, Norway, Iran, Mexico,
Russia and Sri Lanka.
BED WARE:
The product range includes woven and knitted products such as bed sheets,
bed/pillow covers, bed linen, table linen/covers etc. Total exports for six months
ending December 2007 were US $959 million. These exports were US $69
million lower than last year ie 6.7%. Out of the total exports of US $959 million,
countries where exports increased were a total of US $378 million and where
exports declined were a total of US $581 million.
Of the countries where exports were higher than last year, the total increase
achieved was US $60 million. Of the total increase, the significant increases
were achieved in Belgium US $10 million ie 86%, UK US $5.3 million ie 6%,
Italy US $5.8 million ie 19%, Denmark US $4 million ie 48%, Brazil US $3.7
million ie 368%, Kenya US $1.3 million ie 50%, Poland US $1.0 million ie 38%
and Greece US $0.7 million ie 30%. Increases were also recorded in 24 other
countries and some significant percentage increases were in Estonia 132%,
Philippines 97% and Egypt 1102%.
Of countries, which remained lower than last year, the total decline was US
$128 million. Of the major declines USA led with a drop of US $99 million ie
20%, Germany US $6 million ie 10%, UAE US $3.5 million ie 15%, Austria US
$4.0 million ie 73%, Canada US $2.5 million ie 11%, Turkey US $2.0 million ie
93%, Switzerland US $1.4 million ie 53%, Australia US $1.2 million ie 6%,
France US $1.1 million ie 2%, and Hungary US $1.0 million ie 48%. In addition
to these countries exports declined in 32 other countries. Some significant
declines in percentage terms were in Czech Republic 29%, Mexico 52%,
Portugal 58%, Ukraine 57%, Indonesia 78%, China 90%, Japan 70%, Maldives
91% and Bangladesh 96%.

TOWELS:
Products included in this group are towels and products of towel material of
cotton, mill made. Total exports were US $284 million or 3.3% of total
Pakistan's exports (last year 3.9%). Exports declined over last year by US $39
million ie 12.2%. Of the total exports of US $284 million, countries where
exports increased over last year were US $67 million only. Where exports
declined, the total exports were US $217 million.
The total increase in exports achieved from countries where exports were
higher than last year was US $15 million. Of this, the significant contributors
were UAE US $2.4 million ie 24%, Spain US $1.4 million ie 17%, Sri Lanka US
$1.2 million ie 350%, Netherlands US $1.0 million ie 15%, South Africa US $1.0
million ie +16%, Saudi Arabia US $0.7 million ie 22%, Brazil US $0.7 million
46%.Apart from these countries exports increased in more than 35 other
countries. Some significant growth in percentage term was achieve in Ireland
34%, Portugal 55%, Malaysia 104%, Romania 99%, Argentina 404%, Austria
173%, Cyprus 97%, Lithuania 257%, Philippine 209%, Jordan 125% and Hong
Kong 319%. These reflect the exporters and TDAP's efforts to diversify into
newer markets.
The total decline in exports in countries which remained lower than last year
was US $54 million. Of this, major countries which were lower than last year
were USA US $43 million ie 23%, Canada US $1.4 million ie 18%, France US
$1.4 million ie 33%, Sweden US $1.0 million ie 37%, Czech Republic US $0.8
million ie 56%, Russia US $0.7 million ie 37%, New Zealand US $0.8 million ie
22% and Belgium US $0.7 million ie 15%. Additionally declines were recorded
in 27 other countries as well, with no one country declining by more than US
$500 K. Some significant and noteworthy declines in percentage terms were
Denmark 22%, Norway 18%, Turkey 93%, Mexico 81%, India 100%, Germany
3.48%, Italy 6.4%, Slovenia 36.3% and Kenya 29.5%.
ARTIFICIAL SILK AND SYNTHETIC TEXTILES:

The product range included is fabrics, synthetic filament, printed dyed or mixed,
manmade staple fibers. Worldwide, textiles and apparel produced from

manmade fiber or with manmade fiber is the dominant sector. In Pakistan this
sector has remained depressed partly on account of poor growth in the filament
yarn sector.
Be as that may, the current exports for six months ending December 2007 were
US $256 million. This is an increase of US $41 million over last year ie 19%. It
may be recalled that artificial silk and synthetic textiles exports, even last year,
grew by 11.5% contributing US $229 million to the growth in Pakistan's exports.
The countries that were performing better than last year produced a total export
level of US $198 million. Those that remained below over last year were of a
total export value of US $58 million.
Some noteworthy and significant trends in terms of percentage increases were

Finland 32%, Hungary 41%, Australia 72%, Morocco 14.4%, New Zealand
13.3%, Romania US $0.6 million ie 2.8%, Thailand US $0.6 million ie 1.67%
and Canada 19%.
Total decrease in exports as a total of all countries that remained below last
year was US $18 million. Of this, significant declines were in Spain US $2.7
million ie 23%, Italy US $2.7 million ie 29%, Niger US $1.7 million ie 53%,
Poland US $1.5 million or 31%, Belgium US $1.1 million ie 21%.
Exports of artificial silk and synthetic textiles has in last few years shown a very
healthy growth trend and producers, exporters should fully capitalise on this
opportunity. It appears that the opportunity is widespread as exports are not
concentrated in a few markets and a large number of countries are reflecting a
willingness to buy from Pakistan.
TENTS AND CANVAS:

This product group includes products such as sails, tents, tarpaulins, awaning,
sunblinding, etc. Total exports for six months ending December 2007 were US
$42 million and remained US $0.6 million or 1% below last year. The major
countries contributing to increases over last year were Sudan US $9 million,

with increases in Jordan, Kenya and Yemen remaining between US $1.0 million
to US $1.3 million each; the major countries which pulled down Pakistan's
exports were Saudi Arabia US $9.3 million ie 52% and Kuwait US $1.7 million
ie 25%. This product group largely remains dependent on donor purchases and
there is an enormous potential and need to diversify product range including
products of the leisure industry.
……………………………………
EXPORT FROM PAKISTAN
VLAUE IN '000' $
S. COMMODITY BY COUNTRIES 2004-05 2005-06 2006-07
% % %
NO. EXPORT SHARE EXPORT SHARE EXPORT SHARE
TEXTILE & GARMENTS
A CATEGORY
1 RAW COTTON 109,957 0.76 68,151 0.41 50,226 0.30
2 COTTON YARN 1,056,535 7.34 1,382,874 8.41 1,428,041 8.41

YARN OTHER THAN COTTON
3 YARN 30,916 0.21 36,996 0.22 67,193 0.40
4 COTTON CLOTH 1,862,886 12.94 2,108,183 12.81 2,026,388 11.94
5 KNITTED CROACHED FABRICS 187,158 1.30 51,378 0.31 63,568 0.37
6 READY-MADE GARMENTS 1,087,954 7.56 1,309,990 7.96 1,384,775 8.16
7 KNITWEARS 1,635,033 11.36 1,751,494 10.65 1,961,048 11.55
8 TEXTILE MADE UPS. 2,436,013 16.93 3,043,582 18.50 3,069,651 18.08
a) BED WARE 1,449,533 10.07 2,038,064 12.39 1,995,899 11.76
b) TOWELS 520,480 3.62 587,641 3.57 602,547 3.55
c) TEXTILE MADE UPS

(EXCL.TOWEL&BEDWARE)
466,000 3.24 417,877 2.54 471,205 2.78
9 TENTS AND CANVAS 66,569 0.46 38,902 0.24 69,060 0.41

ART SILK AND SYNTHETIC
10 TEXTIL 300,264 2.09 200,308 1.22 419,724 2.47

EXPORT FROM PAKISTAN ( USA )

Value in 000 $
% % %
S. Top 10 Major Products 2004-05 SHARE 2005-06 SHARE 2006-07 SHARE
1 KNITWEAR ( HOSIERY ) 929,399 26.97 1,087,589 25.94 1,261,437 30.15
2 BED WEAR 595,505 17.28 1,046,659 24.96 941,704 22.51
3 READYMADE GARMENTS 376,021 10.91 520,894 12.42 533,920 12.76
4 TOWELS 255,457 7.41 325,485 7.76 336,538 8.04
5 MADEUPS ART. OF TEX. 241,445 7.01 242,924 5.79 286,007 6.84
6 COTTON FABRICS 292,185 8.48 305,894 7.30 192,780 4.61
7 CARPETS 109,782 3.19 112,017 2.67 92,225 2.20

LEATHER
8 MANUFACTURES 82,928 2.41 92,845 2.21 83,519 2.00
LEATHER CLOTHING 43,042 1.25 47,334 1.13 47,898 1.14
LEATHER GLOVES 29,426 0.85 34,813 0.83 28,404 0.68
OTH.LEATEHER MANUF. 10,460 0.30 10,698 0.26 7,217 0.17
9 COTTON YARN 106,467 3.09 127,557 3.04 81,249 1.94

SURGICAL
10 INSTRUMENTS 52,835 1.53 50,134 1.20 45,537 1.09
SUB TOTAL 3,042,024 88.26 3,911,998 93.30 3,854,916 92.15
EXPORTS BY ECONOMIC CATEGORIES

VALUE IN MILLION DOLLARS
YEAR TOTAL PRIMARY % SEMI % MANUFGD %
EXPORTS COMM. SHARE MNFGD. SHARE COMM. SHARE
1980-81 2,958 1,295 44 335 11 1,328 45
1981-82 2,490 864 35 332 13 1,294 52
1982-83 2,708 812 30 363 13 1,533 57
1983-84 2,768 800 29 383 14 1,585 57
1984-85 2,491 720 29 437 18 1,334 53

1985-86 3,070 35 489 16 1,520 49

1,061
1986-87 3,686 977 27 769 21 1,940 52
1987-88 4,455 1,259 28 867 20 2,329 52
1988-89 4,661 1,528 33 875 19 2,258 48
1989-90 4,954 1,007 20 1,171 24 2,776 56
1990-91 6,131 1,145 19 1,498 24 3,488 57
1991-92 6,904 1,312 19 1,477 21 4,115 60
1992-93 6,813 1,006 15 1,405 21 4,402 64
1993-94 6,803 706 10 1,614 24 4,483 66
1994-95 8,137 911 11 2,029 25 5,197 64
1995-96 8,707 1,414 16 1,885 22 5,408 62
1996-97 8,320 932 11 1,711 21 5,677 68
1997-98 8,628 1,096 13 1,495 17 6,037 70
1998-99 7,779 899 12 1,402 18 5,478 70

1999-
2000 8,569 1,040 12 1,317 15 6,212 73
2000-
2001 9,202 1,157 13 1,388 15 6,657 72
2001-
2002 9,135 983 11 1,310 14 6,842 75
2002-
2003 11,160 1,218 11 1,220 11 8,722 78
2003-
2004 12,313 1,228 10 1,448 12 9,637 78
2004-
2005 14,391 1,550 11 1,457 10 11,384 79
2005-
2006 16,451 1,875 11.4 1,771 10.8 12,805 77.8
2006-
2007 16,976 1,900 11.2 1,822 10.7 13,254 78.1

3.3 Problems
Textile sector, the largest foreign exchange earner having 55%t export share, is
fighting hard to remain competitive, which has been dented by the record cotton
prices in the local market. Exporters have predicted further decline in shares of
textile sector in overall export of the country if the present state of affairs
continue to persist in the coming days. Country’s textile sector is struggling hard
since the last fiscal year to compete in the international markets, where its
regional competitors are penetrating by registering substantive growth in export
since the very abolition of quota regime. The textile sector, already facing the
brunt of high energy prices is now faced with soaring prices of cotton which
have 75% share in total cost of the textile products. This has brought more
woes to the textile sector already struggling to maintain its share in the
international market.
On the other hand textile industry has been disappointed at the current year
Trade Policy, saying that the government did not offer any incentive for the
sector to compete with the regional competitors in the international market. The
country's textile exports slumped to $10.561 billion in 2007-08 as compared to
fiscal export target of $12 billion, falling short by $1.46 billion. Whereas, textile
exports in the last fiscal year were $10.787 billion. The regression is mainly
attributed to power shortages, the soaring cost of production and political
turmoil, besides a stiff competition in the world market.
According to the FBS, the growth in textile export goods plunged by 2.6% to
$905.9 million during July 2008 from $930.3 million in the corresponding period
of last year. The growth in textile exports is likely to sluggish further during FY
2008-09 amid decline in cotton production in rain-affected areas of Punjab and
Sindh. Agricultural experts are projecting the local cotton is likely to
approximate 12.5 million bales for the current crop season (2007-08) which
seems remain below official target of 14 million bales on the account of bug
attack on crop harvestings yields. The textile industry including spinning,
weaving and composite has been suffering substantially for the last few years
owing to soaring cotton prices, power failure and shortages, rising interest
rates, increase in cost of doing business and for a number of reasons

but the suspension in the research and development fund and support facility
has made industry vulnerable which ultimately will result into a sharp decline in
textile exports. Cotton prices surged to a record level of Rs 4,400 per mound in
the physical market. Analysts attributed the recent rally in local cotton prices to
expected shortage of cotton production across the globe as well as to lower
than expected cotton crop in the country this year. Pakistan is the third biggest
producer of cotton in the world. As per various estimates, global cotton
consumption in 2008-09 is expected to be 112 million bales, 6% less than last
year. This expected decline is mainly driven by lower crop estimates from USA
and China, fuelling the cotton price rally in the international markets. India’s
cotton production has almost doubled this year to stand at 35 million bales.
The expected shortfall in global cotton production and India’s ban on cotton
exports is pushing local ginners to increase their focus on export market.
Likewise, there is no shortage reported in China. According to local traders,
cotton prices in the local market are also under pressure due to the news
regarding mealy bug attack on crop being harvested in rain affected areas of
Punjab and Sindh. The mealy bug attack is expected to bring down the cotton
crop below its official target of 14 million bales while independent estimates put
the 2008-09 cotton production at around 12.5 million bales.
According to textile exporters, with the rising energy costs, textile sector’s
performance has witnessed a drastic slump in 2007-08 and the current surge in
cotton prices is likely to further hamper the sector’s exports, and hence its
profitability. The expected shortfall in global cotton production and India’s ban
on cotton exports is pushing local ginners to increase their focus on exports
market but it must be kept in view that apart from expected decline in global
production, cotton prices in the local market are also under pressure. The
current surge in cotton prices is likely to add pressure on sector’s margins and
hence its profitability. However, steep rupee depreciation (12 percent against
US$ since July 01, 2008) would inflate the top line of textile companies offering
some respite from soaring cost pressures. Cotton prices in the country are
currently hovering around record levels of Rs4, 100 per mound.

On the other hand, textile and the other exporters also facing a lot of challenges
due to increase in the production cost of the specific export goods, while such
hurdles badly affected the Pakistani exporters to meet the challenges and
compete in the local and international markets. Exporters are demanding that
government should give them facilities to cope with the existing challenges and
not get involved in favoritism. Textile sector was backbone of the country's
economy, but unfortunately, it has badly suffered due to the poor policies of the
Government and government have failed to strengthen this sector efficiently,
which not only caused the weakening of the economy, but also caused cut
down of the huge amount of foreign exchange.
Pakistan could now be confronted with a severe textile crisis after exports fell
7.80 per cent in US$ past year. Yarn exports continue surging, but sales of
apparel, bed linen and cotton fabrics are declining, in bit better sharp contrast
with the boom experienced in the first sixteen months without quotas. Rising
energy and financial costs would be behind the current difficulties, textile
associations said.
After surging in the 3rd year of the post-quota era, Pakistani textile and clothing
exports are now surprisingly falling.
This is extremely worrying for the Pakistani economy that heavily relies on its
textile industry.
Please see below the numbers of mills, which has been closed, and it’s a
dangerous alarm that what will be happen in the near future!!!

List of the closed Mills,
Textile Commissioner's Organization

LIST OF CLOSED MILLS
FROM ….. (1980 - 1995)
DATE of
S# NAME of MILLS LOCATION SPINDLE ROTOR CLOSED
1 KAMANI TEXTILE MILLS MANDRA 12480 0 Jul-92

2 OKRA TEXTILE MILLS ORAKA 43200 0 Sep-92
3 G.M. SPINNING MILLS MURIDKE 25108 0 Feb-93
4 ITTEFAQ TEXTILE MILLS -1 SHEIKHUPURA 13740 0 Feb-93
5 ZUBTUN TEXTILE MILLS KARACHI 12500 0 Mar-93
6 NOORI TEXTILE MILLS NOORIABAD 14400 0 Apr-93
7 ABBASI TEXTILE MILLS R.Y.KHAN 49384 0 Jul-93
8 JUPITER TEXTILE MILLS HYDERABAD 19376 0 Jul-93
9 AZMAT TEXTILE MILLS DHABEJE 24864 Aug-93
10 ATTOCK TEXTILE MILLS PINDIGHED 12480 0 Sep-93
11 SADIQABAD TEXTILE MILLS MULTAN 24880 0 Oct-93
12 SIDDIQUESONS TEXTILES HUB CHOWKI 0 1800 Nov-93
13 AL-QAIM TEXTILE MILLS CHAKWAL 14400 0 Dec-93
14 ZAFAR TEXTILE MILLS JAUHARABAD 24960 0 Dec-93
15 CHAUDHRY TEXTILE MILLS SHEIKHUPURA 24624 0 Feb-94
16 COLONY TEXTILE MILLS MULTAN 52600 800 Feb-94
17 HAMAZIZ INDUSTRIES RAIWIND 0 1440 Feb-94
18 MODIFIL INDUSTRIES KARACHI 0 3200 Feb-94
19 N.N TEXTILE MILLS HUB CHOWKI 0 1376 Feb-94
20 RASHEED TEXTILE MILL 1 KARACHI 11120 2208 Feb-94
21 UNI SPINNERS LIMITED KARACHI 12480 0 Feb-94
22 FRONTIER TEXTILE MILLS BANNU 14400 0 Mar-94
23 HAQ TEXTILE MILLS KHARIANWALA 0 864 Mar-94
24 HARAPPA TETXTILE MILLS SAHIWAL 12768 3600 Mar-94
25 AL-AHMED TEXTILE MILLS NOORIABAD 0 1200 Apr-94
26 COFCOT TEXTILE MILLS HYDERABAD 39600 Apr-94
27 GHARO TEXTILE MILLS GHARO 13200 0 Apr-94
28 JULLO TEXTILE MILLS LAHORE 0 1400 Apr-94
29 KAMAL SPINING MILLS FAISALABAD 5760 0 Apr-94
30 ZAHUR TEXTILE MILLS-1 CHUNIAN 24000 0 Apr-94
31 AWAN TEXTILE MILLS -1 KHARIANWALA 14400 0 May-94
32 HAMRAZ INDUSTRIES MIRPURKHAS 0 1600 Jun-94
33 RAHMANIA TEXTILE MILLS 1&2 FAISALABAD 24400 0 Jun-94
34 SPINGHAR TEXTILE MILLS GADOON 14400 0 Jun-94
35 NISHAT PRODUCT LTD MULTAN 0 1200 Jul-94
36 NISHAN -E-QADIR TEXTILE KOTLAKHAT 0 1004 Oct-94
37 INDUS TEXTILE MILLS HYDERABAD 24800 0 Dec-94
38 YASIR SPINNING FAISALABAD 0 864 Dec-94
39 DANNEMANN FABRICS LTD ROHRI 0 960 Feb-95
40 JAKKEY TEXTILE MILLS KARACHI 0 1155 Feb-95

41 LATIF SHAKIR TEXTILE GADOON 14400 0 Feb-95

42 SCHON SPINNING MILLS KARACHI 12624 1000 Feb-95
43 RASHEED TEXTILE MILL-2 KARACHI 16400 0 Mar-95
44 TARBELA COTTON MILLS HARIPUR 25296 0 Mar-95
45 HAMID TEXTILE MILLS WAN-ADAN 0 960 May-95
46 HAFEEZ TEXTILE MILLS MIRPUR 12688 0 May-95
47 AISHA COTTON MILLS KARACHI 16320 0 Jun-95
48 ATARA TARPAULINE MILLS LAHORE 0 1320 Jun-95
49 BIN BAK INDUSTRIES FAISALABAD 52344 360 Jun-95
50 COLONY SARHAD TEX.MILLS NOWSHERA 28168 0 Jun-95
51 DATA TEXTILE MILLS LAHORE 14400 0 Jun-95
52 GHAFOOR BASHIR TEXTILE FAISALABAD 15744 0 Jun-95
53 HIMALIYA TEXTILE MILLS FAISALABAD 13440 0 Jun-95
54 J.K SPG MILLS (ZESHAN) FAISALABAD 14400 0 Jun-95
55 MUSARAT TEXTILE MILLS FAISALABAD 0 1296 Jun-95
56 ALI ASGHAR TEXTILE KARACHI 34000 0 Jul-95
57 ANNOOR TEX. MILLS DHABEJE 20880 0 Jul-95
58 HASEEB SPINING MILLS JHANG 14400 0 Aug-95
59 ASMA TEX. MILLS KARACHI 0 1600 AUG
60 KARIM COTTON MILLS KOTRI 24960 0 AUG
61 KOTRI TEX. MILLS KOTRI 12400 0 AUG
62 REGENT TEXTILE MILLS KARACHI 13680 0 AUG
63 SAFURA TEX.MILS KOTRI 0 1130 AUG
64 SAJJAD.TEX.MILLS PHAIPHERO 17280 0 AUG
65 SALLY TEX.MILLS JOHARABAD 39184 0 AUG
66 SITARA SPINING MILLS FAISALABAD 18240 0 AUG
67 WAQAS TEX (AA TEX0 SHORKOT 12480 0 AUG
68 ZAHOOR TEXTILE MILLS ORAKA 14400 0 AUG
OLD AND OBSOLETTE UNITS

S. DATE of
NO. NAME of MILLS LOCATION SPINDLE ROTOR CLOSED
1 MANSOOR TEXTILE MILLS SHORKOT 12528 0 Mar-80

2 COOPERATIVE TEX. MILLS KHANEWAL 25600 0 Dec-81
3 KOHINOOR TEXTILE MILLS LIAQATABAD 28000 0 Oct-82
4 MOHAMMADI TEXTILE MILLS HYDERABAD 12400 0 Jan-84
5 MULTAN COTTON MILLS MULTAN 12360 0 Apr-84
6 MADINA TEXTILE MILLLS DHABEJI 10208 0 Jul-84
7 GULBERG TEXTILE MILLS KARCHI 11200 0 Aug-84
8 FATIMA TEXTILE MILLS KARCHI 19499 0 Nov-84
9 AWAMI TEXTILE MILLS KOTRI 12480 0 Aug-85
10 AKBER COTTON MILLS KARCHI 24960 0 Jan-86
11 CHENAB TEXTILE MILLS LAHORE 23952 0 Jul-88
12 CONSOLIDATEED SPG.& TEX LARKANA 12480 0 Jun-89
13 FAKIR TEXTILE MILLS GUMBAT 15540 0 Jun-89
14 PARAS TEXTILE MILLS DERA MAST 24960 0 Jun-89
15 PUNJAB COTTON SHEIKHUPURA 12768 0 Jun-89
16 KHAIRPUR TEXTILE MILLS KHAIRPUR 26400 0 Sep-89

17 ROSE TEXTILE MILLS BHAWALPUR 12480 0 Sep-89

18 BHAWAL PUR TEXTILE MILLS KHANPUR 15200 0 Jun-92
CLOSED DUE TO FAMILY DISPUTE

S. DATE of
1 CENTRAL COTTON MILLS 1&2 DHABEJI 26904 0 May-92

2 CENTRAL COTTON MILLS 3 KOTRI 14384 0 May-92
3 CENTRAL CTTON MILLS 4 KOTRI 12544 0 May-92
4 SHAHYAR TEXTILE MILLS 1 KOTRI 12312 0 Jun-92
5 SHAHYAR TEXTILE MILLS 2 KOTRI 12096 0 Jun-92
6 FAZAL FIBRES LIMITED NOORIABAD 0 1152 Jul-92
7 TEX. CORP.OF PAKISTAN HYDERABAD 12400 0 Oct-92
8 FIRDOUS SPG.WVG.1 KARACHI 14400 0 Nov-92
9 NAVEED TEXTILE MILLS 1 SHEIKHPURA 12480 0 Dec-92
10 NAVEED TEXTILE MILLS 2 SHEIKHPURA 24792 0 Dec-92
11 NAVEED TEXTILE MILLS 3 JHAMKE 20736 0 Jul-93
12 SHAHYAR (DE) TEXTLES NOORIABAD 0 1472 Jul-93
PUBLIC SECTOR UNITS

S. DATE of
1 LASBELA TEXTILE MILLS UTHAL 50000 0 Jun-83

2 BOLAN TEXTILE MILLS BALEI 49980 0 Sep-83
3 SHADADKOT TEXTILE MILLS SHADAKOT 25056 0 Oct-91
UNIT WITH OLD AND SECONDHAND EQUIPMENT

S. DATE of
1 INTERNATIONAL TEX.MILLS KARACHI 5376 672 May-90
2 MALIK TEXTILE MILLS HUB-CHOWKI 0 1240 Jun-90
3 MEHR TEXTILE MILLS CHAKWAL 13056 600 May-91
4 AJAX INDUSTRIES LTD. KARACHI 0 1536 Sep-91
5 TANVEER TEXTILE MILLS TANDOADAM 23200 0 Jan-92
6 AL-AMIN TEXTILE MILLS KOTRI 0 2000 Aug-92
7 INDUS SPINNIG MILLS HYDERABAD 12048 0 Aug-92
8 TARIQ COTTON MILLS KOTRI 13056 0 Aug-92
9 SILVER COTTON MILLS HYDERABAD 9440 0 Oct-92
10 ALI TEXTILE (JHANG) JHANG 32696 0 Jan-93
11 GRACE TEXTILE MILLS CHUNIAN 0 1680 Jan-93
12 UNIVERSAL TEXTILE MILLS KARACHI 3456 1400 Jan-93
13 CALICO COTTON MILLS KOTRI 15504 0 Mar-93
14 JUNAID COTTON MILLS HYDERABAD 13056 0 Mar-93
15 NOOR TEXTILE MILLS KOTRI 16944 0 Mar-93
16 FAROOQ AHMED COTT.MILLS NOORIABAD 0 1200 Apr-93
17 NOON TEXTILE MILLS BHALWAL 16100 0 Apr-93
18 LAHORE SPINING MILLS BHAIPHETO 12500 0 Sep-93
19 ALLIANCE TEXTILE MILLS JHELUM 33080 0 Sep-94

FROM ….. (1996 - 2007)

S. DATE of
1 ZAHID INDUSTRIES OKARA 0 400 Feb-96

2 ROOMI SPINNING MILLS MIANCHUNNU 0 1200 Jun-96
3 GHULAM MURTAZA TEXTILE JARANWALA 0 400 Jun-96
4 ATARA TARPAULINE KAHNA NAU 0 1960 Jun-96
5 AL-FALAH (Ehsan Elahi) MULTAN 1444 0 Jun-96
6 YASIR SPINNING (Shahbaz Tex.) FAISALABAD 0 864 Jun-96
7 AZIZ SPUNTEX LTD. MUZAFARGAR 0 600 Jul-96
8 PIONEER TEXTILE MILLS KARACHI 0 1200 Sep-96
9 SCHON SPINNING MILLS KARACHI 12624 1000 Oct-96
10 M.D.TEXTILE MILLS KOTKAMOKI 0 1896 Feb-97
11 MOHIB TEXTILE (Hashir Textile) MUZAFFARGAR 104280 0 Jul-97
12 HAJI ALLAHDITTA TEX. CHICHAWATNI 0 800 Aug-97
13 ANNOOR TEXTILE MILLS DHABEJI 20880 0 Nov-97
14 ELITE TEXTILE MILLS KARACHI 31416 0 Nov-97
15 YAN TEXTILE INDUS. MANGA 0 1400 Nov-97
16 RAYON TEXTILE MILLS KARACHI 0 1728 Nov-97
17 NAVEED TEXTILE NO.1(Alay Amin) SHEIKHUPURA 12480 0 Dec-97
18 HAMAZIZ INDUSTRIES RAIWIND 0 1440 Feb-98
19 KOTRI TEXTILE MILLS KOTRI 12400 0 Mar-98
20 MADINA WEAVING MILLS BUREWALA 0 800 May-98
21 HASSAN AFTAB (Rahmat Wazir) JUIANWALA MOR 12480 4400 Jul-98
22 HAFIZ TEXTILE MILLS SITE KARACHI 16400 0 Jul-98
23 USMAN TEXTILE MILLS KARACHI 0 1080 Nov-98
24 ATTOCK TEXTILE (Spin Tex Ltd.) JAND 12480 0 Aug-99
25 FEROZ TETXTILE MILLS HUB CHOWKI 0 3136 Oct-99
26 EXCEL TEXTILE MILLS KARACHI 0 3552 Jun-00
27 JAMIA SPG. & WVG. KARACHI 0 1024 Jul-00
28 SHAFIQ TEXTILE MILLS KARACHI 28000 0 Sep-00
29 CRESCOT MILLS LTD. KOTRI 30296 0 Sep-00
30 MODERN TEXTILE MILLS TANDOJAN 4490 480 Jan-01
31 SHAHDADKOT TEXTILE SLHAHDADKOT 25056 0 Sep-01
32 TARIQ INDUSTRIES LTD. SHAH KOT 0 1400 Sep-01
33 KAMAL FACTORY LTD. FAISALABAD 9360 0 Sep-01
34 ELAHI COTTON MILLS MANDRA 12432 0 Apr-02
35 NUSRAT TEXTILE MILLS LTD. JAUHRABAD 20520 0 Jul-02
36 SIFTAQ INTERNATIONAL NOORIABAD 0 1536 Oct-03
37 CHAUDHRI FIBRES LTD. MULTAN 0 400 01-Oct
38 MUSTAFA SPG. (Alzamin Textile) KHURRIANWALA 14400 0 Nov-03
39 SIND FINE TEXTILE MILLS SHIKARPUR 0 1176 Apr-04
40 JUPITER TEXTILE MILLS LTD. HYDRABAD 0 0 Jul-04
41 QADRI TEXTILE MILLS LIMITED BHAWALNAGAR 12480 0 Feb-07
42 GLOBE TEXTILE MILLS LIMITED KARACHI 478 0 May-07
43 ASAD UMER TEXTILE MILLS SARGODHA 8164 0 not mentioned
44 AZAM RAZA TEXTILE MILLS LTD. LAHORE 12480 0 not mentioned
45 FATEH YARN LTD. FAISALABAD 11600 0 not mentioned

46 IHSAN RAIWIND MILLS KASUR 6048 0 not mentioned

47 PLATINIUM SPINNING MILLS KASUR 6500 0 not mentioned
48 PUNJAB COTTON MILLS. SHEIKHUPURA 12768 0 not mentioned
49 PUNJAB TEXTILE MILLS LTD. MULTAN 12400 0 not mentioned
TOTAL CLOSED MILLS (1980 ~ 2007) = 169
3.4 Role of Textile Industry in National Economy
Textile products are a basic human requirement next only to food. This
industrial sector in Pakistan has been playing a pivotal role in the national
economy. Its share in the economy, in terms of GDP, exports, employment,
foreign exchange earnings, investment and contribution to the value added
industry; make it the single largest determinant of the growth in manufacturing
sector. Textile share of over all manufacturing activity is 46%, export earning is
68%, value addition is 9% of GDP and as a provider of employment 38%.
In spite of the government's efforts to diversify exports as well as industrial base, the
textile sector remains the backbone of industrial activity in the country.
Importance of Textile Industry in Pakistan’s Economy

Chapter 4: WEAKNESS OF GLOBAL TEXTILE
4.1 Global Challenges, over view
4.2 Pakistan
4.3 India
4.4 China
4.5 Bangladesh
4.6 Vietnam
4.7 Thailand
4.8 Sri Lanka
4.9 Indonesia

4. WEAKNESS OF GLOBAL TEXTILE
4.1 Global Challenges Over View,

Today the Textile Industry is going through the serious operational problems
due to increased cost of production, low productivity, poor quality, weak
management and poor marketing skills. Hence the Industry is facing serious
threats of losing its share in the international markets
Eight major Asian textile and apparel players share many weaknesses creating
hurdles to the growth of their share in the international markets.
These countries, covering nearly 50 percent of global exports of apparel and 80
percent of Asian apparel exports, have many common problems, including low-
price image, environmental and social regulations, high electricity and fuel cost,
dearth of trained manpower, infrastructure impediments and little exposure to
high-tech machinery, said a study conducted by a Sri Lankan textiles and
clothing sector writer, A H H Saheed, who is also a chartered marketer by
profession. These countries are Pakistan, Bangladesh, China, India, Indonesia,
Sri Lanka, Thailand and Vietnam.
The study, named Global Apparel Industry and Major Asian Suppliers, has
discussed weaknesses of each of the Asian countries dealing in apparel
industry separately.
4.2 Pakistan:
Major weaknesses of Pakistan’s apparel industry include low-price image,
reliability, marketing, political & peacefully environmental, social regulation and
inadequate infrastructure, including power, water and the road network not able
to provide foundation for a dynamic industrial sector.
Similarly, very expensive power, low grade technology leading to low

productivity and poor quality, outdated machinery, lack of considerable up
gradation of human resource skills and confusion in political, religious and
social situation, including terrorism.

4.3 India:
In India again low price image is a major weakness like Pakistan and other
Asian countries. Besides, buyer hardship and control, environmental and social
regulations, narrow export base in garment as over 50 percent is confined to
four products, relatively low technology, hardly available traditional tailoring
background and automation in decentralized garment sector, inconsistent and
low quality and productivity and a higher power cost in India’s power cost also
hampering growth there. As per ITMF – Study 2003, power cost in India is $
0.08 per kw that is higher comparing with seven countries, including China,
Brazil, Korea, Turkey and the USA. Then India’s cotton yield is only 372kgs per
hectare as compared with the world average 900-1000kgs per hectare. Low
labor productivity, pro-employees labor laws resulting in unproductive
employees union in India, which are mainly externally and politically motivated.
4.4 China:
The quota restriction and safeguard measures from the US and the EU are
described as major weaknesses of the apparel industry in China. Then wage
rates in the apparel industry and other production costs, land prices, training,
social fees and shipping costs are rising, Social responsibility/accountability and
labor issues, low price image, buyer hardship, mass production/flexibility have
been counted as some other major issues in China.
4.5 Bangladesh:
Low-price image again emerges as a major weakness in Bangladesh.
According to the writer, interest rate for long-term in Bangladesh is very high,
that is, 9-12%, as compared with 5-6% of competitors. Similarly, no fund for
assistance to textile and apparel sector has been created and when it is
coupled with the dearth of trained manpower of international standards and
lower labor, the situation is translated into low productivity and inconsistency in
quality. Then obsolete production technique, over-dependence on imports,
especially woven fabrics, environment and social regulations are few other
weak areas in Bangladesh. Particularly, reliability and lead-time in Bangladesh

is high as 90-120 days and machinery is mostly outdated unable to keep pace
with technological development. Finally, weak marketing and selling techniques
had made impossible for any company to develop a brand or have any new
market emerged.
4.6 Vietnam:
In Vietnam product quality needs improvement, as technology and machines
are 10-20 years old compared with regional countries, that has put the
production costs very high something around 5-7 percent compared with
competitors China, India, Bangladesh and Indonesia. The country imports fabric
and accessories demand of the clothing industry and it lacks fashion design
badly. High oil prices and being a non-member of the WTO is again a big
challenge for its apparel sector, says the report.
4.7 Thailand:
According to the report, most export products of Thailand are commodity types,
which are subject to fierce competition and have lower prices. Then the lack of
variety and quality products due to shortage of technical manpower and modern
technology is resulting in loss of competitive advantage compared with lower
cost countries, especially in labour wage rate. The wage rate in Thailand is
$1.24 per hour – higher than India, Indonesia, Sri Lanka, Vietnam, Bangladesh
and Pakistan. Relying on imported raw materials, the domestic industry cannot
supply material, especially quality and variety. High cost of production and
difficult to get workers is another big issue there. There is a general lack of
skilled people, particularly in the sewing industry, so productivity is not high and
investments and industrial engineering are limited.
4.8 Sri Lanka:

Continued civil war in the country significantly has suppressed the growth
potential of the economy and adversely affected investor confidence. The
apparel industry there heavily depends on imported raw materials, say 80%, ie,
150 million kgs of fabric are imported annually. The industry has not kept pace
with the technological developments. The issue of longer leader times is also

hampering growth there. The need to import fabrics results in longer lead times
for the apparel industry. The average lead-time – 8 weeks or more and lower
labor productivity are big weak areas of the industry. The fall is attributed to
lower capacity utilization, high labor turnover, absenteeism and under-trained
employees and most factories lacks design and product development,
The domestic market there is relatively small with 19 million people and high
electricity and fuel costs besides weak supply chain management are main
stumbling block there.
4.9 Indonesia:
In Indonesia, political Instability and confusion in the political and social
situation, including terrorism, are proving to be major hurdles facing the
industry. The infrastructure needs improvement. The rising electricity and
fuel costs, increasing trend of minimum wages coupled with low-tech
textile and clothing industries is another weak area of the industry.
Depreciation in rupiah has increased import costs and oil fuel prices.
There is also an increase in the there.

Chapter 5: FUTURE CHALLENGES
5.1 Introduction
5.2 Power Energy Crisis
5.3 Water Crisis
5.4 Quality Development
5.5 Modern Trends for the Apparel Sector
5.6 Emerging Challenges in Cotton Farming in Pakistan
5.7 Compliances Issues
5.8 H.R. Development
5.9 Post Quota Challenges
5.10 E-Commerce in T & A Industries

5. FUTURE CHALLENGES
5.1 Introduction,
The Textile and apparel is considered the backbone of Pakistan’s economy.

Pakistan ranks fourth among world cotton producers and third among world
cotton consumers. With the recent decline in textile exports and a trade deficit
of more than $723 million, Pakistan’s textile industry currently is confronting
new economic challenges. Pakistani textile exporters are facing steep price
competition from manufacturers in China, India and Bangladesh.
Pakistan textile industry’s long history of striving for upgrading quality in product
and process technology, and more recently, its accelerating globalization to
counter the threat of imports into its domestic market, provide insight into
deregulation of its industries in the coming years.
5.2 Power Crisis,

Power crisis is badly affecting the garments sector, which has already been hit
by high inflation, growth decline and monetary crunch.
Government need to take immediate measures overcome and smearing power

crisis and electricity and gas cuts to industrial sector, cautioning that otherwise
unemployment, reduction in tax, failure in achieving export target would add to
miseries of the business community and deepen the economic crisis.
Commenting on the current state of the textile sector, which makes up more
than 67 per cent exports of the country, but rising production cost due to non-
availability of uninterrupted power and gas supply to the industrial units, has
reduced the production and increased cost of doing business in Pakistan.
Textile sector is contributing a lot for the development of the economic growth
of the country but government is not paying due attention to the problems of
this significant sector.

Due to prolong power outages the industry was unable to execute exports
orders in hand and was also not in a position to make further commitments with
foreign buyers due to inability in the wake of the worst energy crises that
Hosiery sector was facing today. They further said that the knitwear apparel
export industry, which is already passing through a difficult phase due to
internal and external pressures, had been badly hit by the on going electricity
crises.
The frequent and prolonged power shut down has crippled this export-oriented
industry, which is employing hundreds of thousands of skilled labor force. They
said that the law and order situation had also adversely affected our country
profile and as a result foreign buyers are not coming to Pakistan.
Pakistan faces severe Power Crisis

These days, Pakistan is passing through worst Power Crisis of its history. The
trickle down effect of inefficiency and mismanagement of last 9 years is in full
flow now and the nation is now reaping what was sown by current regime.
Barely two weeks back, had the good Minister informed National Assembly that
the austerity drive has helped the government save 500MW of electricity, to
reduce power outage. According to him, the government took effective steps to
control power outage including advancing the clock, closure of shopping mall at
2100 hours and reducing the use of air-conditioners and streetlights.

However, ground realities defy government’s statements. Advancing the clock

resulted in confusion and now people are using dual clock system. Shopping
malls are not complying with closure at 2100 hours and markets remain partially
open on Friday and close on Sunday while government announced full closure
on Friday, to save electricity.
Also, according to Pakistan Electric Power Company (Pepco), all power

generation units across the country are producing much below their capacity,
the reason being drastic increase in fuel prices. The government raised oil
prices when oil traded at $145 per barrel but prices were not revised when oil
sided back to $112 per barrel. As majority of producers use oil as primary mean
of power generation, they are badly affected while government is not providing
any relief.
The power supply situation worsened in last few week. Unscheduled load
shedding of up to 16 hours started across the country. As The News reports:
Almost all areas of Karachi were hit by 16 hours of load shedding. Other parts
of Sindh including Hyderabad, Qasimabad, Jamshoro, Kotri, Sehwan, Dadu,
Khairpur Nathanshah, Naushehroferoze, Qazi Ahmad, Nawabshah, Thatta,
Matiari, Sukkur, Larkana, Shikarpur, Jacobabad, Obaro equally suffered from
power outage.
Unannounced load shedding in the different cities of Pujab continuing for 18/20
hours unabated, people in Lahore stand extremely vexed by the load shedding
and business activities have come to a halt. The protesters in Okara also went
violent breaking the windowpanes of Quetta Express at the railway station
besides blocking the railway track. Hundreds of people staged protest at
Bhawalnagar against 18 hours of load shedding and blocked the Bhawalpur-
Manchanabad road. Pakpattan women came out on the streets in protest and
forced the closure of shops in the town. The people demonstrated against
power outage at Gojranawala, Sialkot, Sahiwal, Sargodha, Faisalabad, Sangla
Hill, Kasur and other areas of Punjab.

In NWFP, Peshawar areas Hashtnagri, Kachchi Mohalla, Lahori Gate, Ganj

Gate and other areas’ people suffering prolonged power outage protested
against Wapda, voiced slogans, burnt tyres, pelted stones on passing vehicles
and blocked the G. T. Road near Hashnagri for all sorts of traffic. The situation
is no better in Swat, Kohat, Mardan, Charsadda, Naushehra, Mansehra,
Balakot and other areas of NWFP.
All across Balochistan including Quetta life stands paralyzed due to protracted
load shedding. Quetta Electric Supply Company said that they are forced to
resort to load shedding in Quetta for 6 hours, in the district headquarters for 8
hours, while in the rural areas for 12 hours. Contrary to the claims of the
concerned officials, Quetta several areas witnessing load shedding for 8/10
hours and protracted load shedding at district Bolan, Sibi, Naseerabad,
Jafferabad, Khuzdar, Qalat, Mastung, Naushki,
This is high time for the government and particularly the ministry of Water and
Power to take power crisis seriously. People of Pakistan are already frustrated
with political uncertainty, inflation, raise in petrol prices and street crime. Their
patience should not be tested further.
5.3 Water Crisis,

The water crisis in certain parts of the country is deteriorating into a critical
situation. Pakistan, by the grace of Allah is blessed with countless natural
resources, but lacks the planning to utilize them efficiently. This proper planning
is vital in view of the country's ever-changing geographical situation, and
increasing population. It is unfortunate that the acuteness of this problem has
not yet been felt in its true intensity, and that the requisite planning was not
done much earlier. Although drinking water is available to most of the urban
population during all seasons, there still exists a scarcity of potable water in
most remote areas and desert lands throughout the year.
The total area of Pakistan is 803,940 square kilometers of which land area is
778,720 sq. km, including 200,000 sq. km irrigated land and 1046 sq. km
coastal area. Inexpensive drinking water can be obtained in coastal areas by
installing low cost water treatment plants that using solar energy for the

desalination of seawater. The cost of installing such plants is well justified by

the decrease in operating costs due to the avoidance of conventional alternate
fuels. Some Middle Eastern countries, such as Saudi Arabia, have started to
reap the benefits from this abundant natural source of energy. If solar power is
made available for the desalination of seawater, the shortage of drinking water,
even in far-flung areas of the country (such as barren lands in Baluchistan, and
desert areas in Sindh, e.g. Thar) may be eliminated. Pumping seawater to
these remote areas, and treating it to convert it into drinking water can
accomplish this. Alternately, seawater can be desalinated near coastal areas,
and untreated water thrown back into the sea or the salt zone, and the treated
water supplied to small towns and villages by pumping stations. This process
not only ensures the availability of abundant drinking water, but also provides
employment to the locals. The salt obtained from this process can be used in
commercial and industrial applications. Pakistan already owns a small
experimental desalination plant utilizing solar energy, near Gwader, which is
operated and maintained by the Pakistan Navy. This plant was designed and
manufactured by the Pakistan Council of Industrial & Scientific Research
(PCSIR). The use of treated seawater may, in the future, save many lives in
times of drought.
URBAN AREAS
The shortage of drinking water is not as severe in urban areas as in remote
areas, except in the summer or winter seasons. The generous use of drinking
water and leakage in pipelines and taps are among the major causes of water
wastage, amounting to millions of gallons per day. Flushes in toilets and the
use of drinking water in gardening also add to the wastage of drinking water.
One flush requires about three to four gallons of water.
Brackish water or treated sewage water ought to be used as substitutes for
potable water for these purposes.
One of the most serious issues related to the water shortage in the country is
the mishandling of wastewater from raw sewage, industrial waste, and
agriculture runoffs, which increase the contamination in natural sources of fresh
water. Sewerage water, therefore, ought not be allowed to fall into the sea or

rivers, but should be treated properly, and stored outside the cities or villages to
be supplied back to the residents for use. The recycling of sewerage water and
its storage outside the cities will raise ground water levels, and the treated solid
waste is a natural fertilizer. While recycling sewer water and its accumulation
may create water-logging in some areas and increase the salinity of the soil, in
most cases (in Baluchistan and Thar, for example) it will raise the water level
and result in fertile soil. Water-logging and salinity may be controlled through
the use of modern scientific technology. Since Karachi is Pakistan's largest city,
its requirements are entirely different from those of the rest of the country.
Karachi needs at least 20 million liters of water per day for drinking only, out of
the city's total requirement of 600 MGD (million gallon per day).
The main water resources for the city are the Kinjeer Lake, where water comes
from the Indus River, and the Hub River where a dam has been built to capture
rainwater. The condition of these water resources and the sewage planning
needs to be reviewed afresh to minimize the wastage of fresh drinking water.
One of these objects may be achieved by removing seaweed and other marine
plants and mud from the Kinjeer Lake and the Hub Dam.
This will decrease unnecessary contamination, increase the water capacity, and
maintain the depth of the lake and dam. It is even more important to take the
sewerage water away from city limits in low-lying areas. An area with low water
levels and rocky planes, at least 40-60 miles away from Karachi, along the
super highway would serve the purpose. The accumulation of water in that area
will serve to raise the water levels, and boost the local economy by enabling the
natives to cultivate more fresh produce, especially seasonal vegetables and
fruits around the year, using recycled water. Treated organic waste from the
sewerage water treatment plants may be used as natural fertilizers for local
farms.
The use of the latest technology has allowed Middle Eastern countries to use
micro and sprinkler irrigation systems, which are particularly beneficial to some
seasonal crops and greenhouses. Israel, in particular, has pioneered the
development of drip irrigation systems, and has improved this technique with
sensors and computer controls that respond to plant requirements rather than

using a predetermined watering schedule. Drip irrigation, however, is an

expensive technology and is not suitable for some crops.
INDAH Water Konsortium (IWK), a Malaysian organization, has signed a RM

1.7 million joint-venture research collaboration agreement with University Putra
Malaysia (UPM) to conduct research and development (R&D) of the wastewater
treatment industry. The five-year research collaboration of IWK with UPM will
enable them to improve treatment and management of sewerage sludge. This
is a good opportunity for Pakistan and Malaysia to gain mutual benefits by
exchanging experiences and views regarding waste water issues.
The research and development being conducted in Malaysia can provide
Pakistan with vital knowledge in seeking cost-effective solutions.
In the State of Victoria, Australia, Barwon Water is a statutory authority

responsible for water and sewage management. Its service area covers 8,100
sq. km, and includes Geelong and the Bellarine Peninsula along the coast to
Apollo Bay, and rural areas including Colac. Barwon Water also manages 20
kilometres of the Barwon River through urban Geelong. The Australian
government feels that environment protection is of paramount importance in the
treatment of the region's sewerage. Coastal treatment facilities have been
designed to protect the region's beaches, which are some of the most popular
holiday and recreational destinations in Australia.
Barwon Water operates nine sewerage treatment plants. Commissioned in

1995 at a cost of $6.3 million, this land-based system treats sewage from the
coastal townships of Aireys Inlet and Fairhaven. Land-based treatment consists
of two primary lagoons and a small maturation lagoon. Treated effluent is used
to irrigate wood lots on the site. On average, 270 kilolitres of sewage is
received each day. Sludge eating bacteria are introduced to the waste water,
which then undergoes ultraviolet disinfection, producing a clear effluent,
suitable for reuse or ocean discharge. This, Barwon Water's largest treatment
plant and the largest plant of its type in Australia, utilises the Intermittently
Decanted Extended Aeration (IDEA) activated sludge process to process, on

average, 55 million litres of sewerage per day into effluent suitable for ocean
discharge or reuse.
The sewerage from the Bellarine Peninsula townships of Portarlington, St.
Leonards and Indented Head is similarly treated at a plant on 190 hectares
southeast of Portarlington. The plant has four treatment lagoons, a pumping
station, and a fixed-sprinkler irrigation system. It treats 1.25 megalitres a day
which is then used to irrigate more than 100,000 trees on site. Another plant,
established in 1981, is a lagoon-based system which treats 0.19 kilolitres a day.
A series of treatment lagoons and an irrigation system form the basis of this
facility. The plant is on 40 hectares north of the township. About 12,000 trees
are irrigated using the treated effluent.
Water Availability Million Acre-Feet (MAF) at Canal Head during 1998-99
Kharif Rabi Total
Punjab 37.07 18.94 56,01
Sindh 31.93 15.18 47.11
Balochistan 2.85 1.02 3.87
NWFP 0.54 0.70 1.24
Total 72.39 35.84 108.23
The cotton crop suffered for a variety of reasons including heavy rainfall in May
2007 causing poor germination in Punjab, high temperature during August and
September 2007 causing more shedding of fruit parts and pest attack,
especially dangerous mealy bug infestation. Consequently, cotton production
declined to 11.7 million bales this year from 12.9 million bales last year – thus
registering a negative growth of 9.3 percent. The wheat crop was adversely
affected by the shortage of irrigation water by 23.3 percent over normal During
the current fiscal year (2007-08), the availability of water for Kharif 2007 (for the
crops such as rice, sugarcane and cotton) has been 5.5 percent more than the
normal supplies and 12.2 percent more than last year’s Kharif (see below
Table). The water availability during Rabi season (for major crop such as
wheat), as on end-March 2008 was, however, estimated at 27.9 MAF, which
was 23.4 percent less than the normal availability, and 10.5 percent less than

last year’s Rabi, adversely affecting the wheat crop, production of which has
decreased by 6.6 percent over the last year.
Wheat is a stable food item of Pakistani people, therefore, it is grown in almost

every part of the country. It contributes 12.7 percent to the value added in
agriculture and 2.6 percent to GDP. Area and production target of wheat for the
year 2007- 08 were set at 8578 thousand hectares and 24 for the decline in
wheat production this year. Firstly, as a result of delayed start of sugar
crushing season and late cotton picking by the growers, the area sown under
wheat crop declined by 2 percent. Secondly, the higher prices of DAP (Rs 850
to Rs 3000 per 40 Kgs) discouraged farmers to use more phasphatic fertilizer,
thus affecting yield of the crop. Thirdly, shortage of irrigation water by 23.3
percent over normal supplies during Rabi season affected wheat crop.
Finally, the incidence of severe frost on early sown crop caused damage in
some areas of Punjab and NWFP.

Efficient irrigation system is a pre-requisite for higher agricultural production

since it helps increase the crop intensity. Despite the existence of good
irrigation canal network in the Pakistan, it still suffers from wastage of a large
amount of water in the irrigation process.
During the monsoon season (July-September, 2007) the normal rainfall is 137.5
mm while the actual rainfall received stood at 125.00 mm, indicating a decrease
of 9.1 percent. Likewise, during the winter (January to March 2008), the actual
rainfall received was 49.3 mm while the normal rainfall during this period has
been 70.5 mm, indicating a decrease of 30 percent over the normal rainfall. The
details are in Table 2.13. In order to alleviate water scarcity, the government
has given top priority to the development of water resources in order to uplift
the agro-economy. About 71.00 billion development budget is being expended
in water sector to achieve the objectives through augmentation and
conservation means i.e. by construction of medium and large dams and by
efficient utilization of irrigation water, restoring the productivity of agricultural
land through control of water logging, salinity and floods. Water conservation is
being ensured through rehabilitation remodeling of irrigation system and lining
of canals. Integrated program approach is being adopted like “National Program
for
Watercourses Improvement in Pakistan and Flood Protection Program”
Following major objective were achieved or planned to be achieved by adopting

the above-mentioned strategies in water sector during the year 2007-08.

5.4 Quality development
Quality is a critical success factor in the global competitiveness of Pakistan's

readymade garments industry and the country's economy in general. In the
textile and clothing industry quality control is practiced right from the initial stage
of sourcing raw materials to the stage of final finished garment. For textile and
apparel industry product quality is calculated in terms of quality and standard of
fibres, yarns, fabric construction, color fastness, surface designs and the final
finished garment products. However quality expectations for export are related
to the type of customer segments and the retail outlets
Textiles and clothing trade is a vital part of the world economy with many
nations heavily dependent on the sector for foreign exchange earnings and
employment generation. Today textiles and clothing trade accounts for nearly
6% of total world exports. Many of the least developed and small developing
countries have built a huge dependency on the sector, which often accounts for
more than 90% of industrial exports and more than 50% of total employment.
With increased global competition, many sectors within the textile industry are
increasing production efficiency. Research, innovations and development in
technical textiles, yarn quality, clothing products, process performance, fabric
finishing, coloration technology and marketing can bring significant
advancements in the textile sector and market supremacy.
With the complete phase-out of quotas, the Textile & Clothing Sector has been
experiencing another global revolution. This trade liberalization process is
creating huge uncertainty among textile producing countries, workers and
enterprises worldwide. It has increased fears and hopes in both importing and
exporting countries. However, it is certain that some countries would benefit
from the opening of markets, while others would encounter growing difficulties
as a result of increased international competition. The magnitude of gains and
losses is a matter of considerable debate. As a result of changing global buyers'

strategies, there would be considerable consolidation of production, both

between countries and within countries.
Growth of world population and the consumption patterns in developed

countries has a marked effect on the global composition of trade of textiles and
clothing. Which has also undergone significant changes. According to WTO
estimates; with the elimination of quotas the total trade of textiles and clothing
will exceed the US $ 500 billion mark. The growth will be driven by the clothing
sector, which will constitute almost 70% of the total trade. Clothing imports
across the board are increasing at a faster rate than textile imports. This pattern
is expected to continue.
The apparel/clothing segment is the highest value added link in textile value
chain. The dynamics of world trade of apparel and its marketing aspects, as
well as analysis of Pakistan's export market and its competitor analysis can be
studied more appropriately, Pakistan with total Apparel exports of US $ 2.71
billion in 2003 has a meager share of 1.2% in the global apparel market. In
2004-05 the overall growth in the Apparel exports has been approx. 29%, at the
level of US $ 993 million in 2004-05. The growth in the apparel sector of
Pakistan has been consistent over, last 3 decades. The Pakistani apparel
exporters/manufacturers have kept their focus on producing only traditional
products. Product development is considered to be a high-risk activity in the
business circles.
Human capital formation for the textile industry development is the most critical
area of intervention. In order to achieve high degree of value addition through
making the apparel and textile made-ups sector the engine of exports growth,
focus has to be laid on structured training programs with the objective to ensure
a consistent supply of well equipped manpower. The highest value addition in
the textile sector can only be achieved through a rapid development of
manpower, equipped with the requisite skills to enable the country compete in
international markets. Three major areas that would require organized training
in the apparel sector include:

Apparel Designing:
The apparel sector of Pakistan has relied on re-active marketing of its products.
Due to the lack of training facilities and skills to indigenously design apparel
products the industry has not been pro-active in marketing its products
internationally. Such a strategy leaves a large part of the international garment
markets untapped and also inaccessible by the local manufacturers. Only
formal training in garment designing in line with the fashion trends will enable
the apparel sector to realize its full potential.
Apparel Stitching:
Since the stitching of garments is labor-intensive process the productivity has a
strong correlation with the skill and efficiency of the worker. Global studies have
estimated that the productivity of Pakistani stitching worker is less than that of
Bangladesh, Indonesia and China. To compete with these countries in the
global markets, the apparel industry will require training to employ efficient
methods of production through worker skill enhancement, wastage reduction
and consistency in quality.
Merchandising and Marketing:

The success of an apparel unit is dependent upon the strength of its
merchandising and marketing team. The progressive manufacturers and
exporters use the services of business graduates to achieve this end. Most of
them have to go through on the job-training program for developing basic
understanding about the textiles. There is need to develop human resource
equipped with business skills and basic knowledge of textiles so as to enable
them formulate export marketing plans by taking into consideration the global
consumption and demand patterns. There is a huge shortage of facilities to
enhance labor skills and produce competent supervisors who have in-depth
knowledge of processes and hands-on experience. The existing institutions,
which are involved in such training programs, are in dire need of restructuring to
up-date their syllabus and upgrade the training equipment.

In nutshell all the Textile Institutes are facing problems of syllabus/curriculum,

getting well qualified faculty members, provision of testing facilities, teaching of
quality control methods, environment friendly techniques, shortage of books in
the library and shortage of funds for recurring expenses.
5.5 Modern Trends, Challenges for the Apparel Sector
Apparel manufacture is an important value-added sector of the textile industry

of Pakistan. This sector manufactures and exports ready-made garments,
woven as well as knitted, of all types such as trousers, ladies suits, jeans,
Children garments, maxies, blouses, skirts etc. Exports from ready-made
garments and knitwear sectors crossed $1.0 billion mark each for the first time
in the history of Pakistan in 2002-03, contributing about 30.27% to total textile
and clothing exports and 52.78% to total value-added exports. The jump in
apparel (readymade garments and knitwear) exports from $ 1,723 million in
2001-02 to $2.24 billion in 2002-03 was mainly due to the concessions allowed
by the E.U, mainly increase of quota by 15% with effect from 01.12.2001 and
abolition of import duty with effect from 01.01.2002.
However, with effect from March, 2004, the E.U. re-imposed import duty @
12%. Currently, textile and clothing exports from Pakistan to E.U. are subject to
an import duty of 9.6% because these are more than 1% of the E.U. market for
textile and clothing. Consequently, these exports being ineligible for GSP
concessions have remained almost stagnant in 2003-04 and 2004-05 at about
$2.47 and $2.74 billion. In fact, textile and clothing exports from Pakistan are
under severe strain after the commencement of WTO, the World Trade
Organization, with effect from 01.01.2005. In contrast, Bangladesh and Sri-
Lanka enjoy better access to the E.U. market. The textile and clothing exports
from these countries are subject to Zero and 50% of import duty respectively as
compared to Pakistan’s textile and clothing exports.
The woven garment units in Pakistan are presently estimated at about 5000.
The total installed capacity of these units is about 600,000 machines and
annual production is about 700 million pieces. About 700 units are operating in
the knitwear sector. The installed capacity is 21,000 knitting machines and

annual production is approximately 550 million pieces. About 80% of these

units operate on small scale as cottage industry. Most of these units lack
modernization. Under the Textile Vision 2005 policy of the Government of
Pakistan (GoP), announced in 2000, garment and knitwear sectors were
allocated a sum of Rs 39 and Rs 29 billion respectively for the import of
stitching, sewing and knitting machines for Balancing. Modernization and
Replacement (BMR) and expansion. The utilization of the allocations was only
15.39% and 35.79% respectively up-till the end of 2003.
Furthermore, the textile industry, including the garment and knitting sectors,
have lost competitive edge on account of higher cost of inputs in comparison
with other regional textile producers e.g., India, China, Bangladesh, Sri-Lanka,
Korea, Malaysia, Indonesia and Thailand. Relevant data on comparative costs
of some of the inputs is reported as under:
On top of it WAPDA is considering a further increase in power rates on account

of rise in prices of furnace oil.
The data reported above clearly demonstrate that charges for utilities are much
higher in Pakistan than those in India, Bangladesh and China. More-over
Bangladesh, China and India subsidies their textile exporters.
In Bangladesh, export earnings from knit-wear and readymade garments are
taxed at 0.25% only as final settlement of tax liability. Local procurement of
yarns and fabrics is subsidized upto 5%. Chinese government subsidizes its
textile industry by means of 10% export rebate. The Indian textile industry
benefits from 5% interest reimbursement under the Technology Up-gradation
Fund Scheme (TUFS). The export earnings in India were exempted from tax to
the extent of 30% in 2004-05.

Because of the lower input costs and subsidies textiles, garments, knitwear and
clothing manufactured in Bangladesh, China and India are cheaper than those
of Pakistan by about 20 to 30%. Korean, Malaysian and Indonesian garments
are also reported to be more competitive in price and quality-wise. The loss of
competitive edge by the textile industry in general and apparel sector of
Pakistan in particular is mainly due to higher cost of inputs, lack of
modernization and non-availability of suitable subsidies from the government of
Pakistan.
The garment and knitting sectors of Pakistan are in general not fully prepared to
face the challenges of the modern trend towards fast changing fashion apparel
following changes in the life style of men and women all over the world,
especially in the young generation. Some of these challenges are Shorter lead
times, Shorter development times, Small quantity of production and quick sales,
Just-in-time deliveries and Production of the required quality at competitive
prices.
It is not possible for the garment sector to adequately cope up with the fore-
mentioned challenges without the input of educated and trained manpower of
high caliber. The textile institutes and universities must handle the task of
producing graduates and diploma holders of the standard required by the
garment sector. In order to discharge this responsibility efficiently the institutes
and universities must develop curriculum very carefully. In addition to the
theoretical subjects, required skills must be made a part of the curriculum
usually designated as “Apparel Manufacturing and Merchandising”.
In order to develop these skills the prospective graduates must be assigned

hands-on exercises. This technique will enhance the practical capabilities of the
graduates for the prospective employers and the need for lengthy training and
orientation periods will be reduced. Some of the important skills to be
incorporated in the curriculum are listed below:
 Knowledge of the fabrics and other raw materials.

 Production planning and control.

 Implementation of total quality management system as envisaged in ISO

9001/2000, JC Penny System etc.
 Knowledge of basic tools used in apparel manufacture.
 Training of common software and equipment.
 Cross-departmental training to gain knowledge of the complete
processes.
For producing skilled workers for the apparel sectors, the Textile Ministry has
constituted a Textile Garments Skill Development Board. At present 450
workers are being trained in 15 big apparel units of Karachi, Lahore and
Faisalabad.
This is a common technique used in the education system of the U.S.A. for
imparting training for skill development in the students. Six-month credit-earning
practical are conducted for the students under the supervision of the faculty of
the concerned institute or university at the factories of the prospective
employers. The institutes and universities in Pakistan with the cooperation of
the apparel industry to provide hands-on-training to our students can adopt a
similar system:
In order to motivate the educated and trained graduates and to progress and
better performance, the garment units should implement incentives and
rewards systems. Such systems are usually based on performance evaluation
involving assessment of the employee efficiency and contribution to product
quality and output rate. The incentives and rewards should be in the form of
increment in salary, bonus, promotion to higher designation and special
allowances.
The speed with which the fast fashion apparel reaches the market is extremely
important because the consumer requirements can change quickly. In order to
meet the challenge of just-in-time delivery, the garment units should develop an
efficient supply chain network with the participation of whole sellers and
retailers. Feed back from the market will be more efficient and the apparel units
will be in a position to plan production of smaller quantities to meet the
requirements of the consumer’s quality and cost of production.

Its leasers before the National credit consultative council (NCCC) of the State
Bank of Pakistan (SBP) recently represented the case of the textile industry.
They argued that the textile industry has made an investment of $5.0 billion on
modernization and technological up-gradation of its production facilities as well
as on expansion during the last five years. In spite of the implementation of
balancing, modernization and replacement programs (BMR), the textile industry
has lost its competitiveness in the international export market in comparison to
other regional textile exporters such as China, India, and Bangladesh, mainly
due to higher cost of inputs. They emphasized that the competitiveness of the
textile industry can be restored by implementing the incentive package of Rs.50
billion as recommended by the special committee of the Textile Ministry. Salient
features of this package are a cut in mark-up rates, devaluation of the rupee
and reduced gas tariff for the textile industry, identical to the tariff allowed to the
fertilizer industry. However, the Government of Pakistan has approved a
revised package of about Rs.25 billion only comprising of the following
incentives:
 Cash subsidy for research and development (R&D) has been extended
for one year at the rate of 6% for garment and knitwear sector, 3% on
fabric exports and 5% on home textiles. The R&D work includes market
research, design and brand development, innovation and special quality
products.
 Exemption from payment of ESSI and EOBI contributions.
 Reduction in export finance rate from 9% to 7.5%.
 Merger of the machinery imports under Long Term Financing (LTF) with
LMM scheme of the SBP and fixing the mark-up on such financing at7%.
The package announced by the GOP has received mixed reaction from the
textile industry. Some of the associations of trade and industry are of the view
that it is too little and too late. Nevertheless, the relief package of the GOP is
expected to facilitate the textile industry in general and the apparel sector in
particular to regain competitiveness in the international export market to some
extent.

5.6 Emerging Challenges in Cotton Farming in Pakistan

One of the key challenges facing the cotton sector is how to maintain economic
viability of cotton farming in the face of globalization, rising competition from
synthetics, and increasing input prices and competition for land, water, and
other resources from other crops and nonfarm uses. For example, the growth in
input prices is higher than the growth in output prices. Thus, an important
challenge is how to increase productivity to offset the impact of rising input
prices on the economics of cotton farming. Another important challenge is how
to minimize the losses caused by pests and weed infestations. How to assess
and evaluate the potential of Bt cotton under Pakistan’s conditions and
developments of such cultivars in the country is a further challenge facing the
sector. Reducing contamination in cotton and raising the quality of cotton lint is
another critical challenge that confronts the sector.
Cost of Production
The principal input costs in cultivating cotton include seed, chemical fertilizers,
pesticides, weedicides, diesel, water, and labor in addition to land. Annual data
on selected nominal farm input prices along with the cost of production of seed
cotton are shown in Table 3.13 from 1990–1991 to 2004–2005. There are
substantial increases in the prices of all the inputs. Custom hire rate of plowing
one acre has increased from Rs 35 in 1990–1991 to Rs 150 in 2004–2005,
whereas the wage rate has increased from Rs 31 per person-day to Rs 100.
The price of seed has escalated from Rs 6/kilogram in 1990–1991 to Rs
50/kilogram in 2004–2005. The prices of diammonium phosphate (DAP) and
urea, the most commonly used fertilizers in Pakistan, have gone up from Rs
203 and Rs 150 per 50-kilogram bag to Rs 953 and Rs 424, respectively. The
canal water rate has increased from Rs 34 per acre to Rs 93 in 2004–2005.
The cost of cultivation reflects changes in input prices

Prices of important inputs and cost of production of seed cotton

(These data are drawn from various issues of The Pakistan Journal of
Agricultural of Agricultural Economics and cotton policy reports of the
Agricultural Prices Commission.)
The average annual growth rates in the prices of inputs, the cost of cotton
cultivation, and the cost of production are higher than that of the consumer
price index (CPI). The average growth in CPI is 7.2 percent. The average
growth in the cost of cultivation of cotton is 10.1 percent in Punjab and 12.6
percent in Sindh. The average growth in the cost of production is 10.4 percent
in Punjab and 9.6 percent in Sindh. However, the data in Table 3.11 indicate
that the average annual increase in the market price of seed cotton has been
only 7.5 percent. Thus, cotton farmers are squeezed between increasing input
prices and the slower rise in output prices. As a result, the quantity of seed
cotton required to buy a given level of various inputs used in farm production
has increased, as shown in below Figure,

Seed cotton required to buy selected input
The real cost of cultivation of cotton has increased by 2.9 percent per year in
the Punjab province (average increase in cost of cultivation less change in CPI)
and by 5.4 percent in the Sindh province. Nevertheless, the real market price of
seed cotton in Table 3.11 has not shown a statistically significant average
annual growth (0.3 percent). At the same time, cotton yield over this period has
widely fluctuated. In Table 3.3, the coefficient of variation for crop yield is 13.7
percent for all Pakistan, 17.5 percent for Punjab, and 24 percent for Sindh.
These developments have adversely affected the income and welfare of cotton
farmers.
Economic losses due to pest infestation are substantial. They average 10–15
percent in normal years and 30–40 percent or even higher during abnormal
times. Pakistan has experienced many such losses in recent years. In view of
the importance of cotton crops and the implications of production losses
to rural incomes and the performance of the economy, it is imperative to
develop an effective strategy and adopt all possible measures to arrest and
reduce these losses. Effective pest control, inter alia, depends on pest scouting
for identification of insects, stage of life cycle, and intensity of attack/infestation
(higher or lower than economic injury level), and judicious use of pest control
methods. Proliferation of substandard insecticides in the market, aggressive

marketing by pesticide companies, and the farming population’s limited

knowledge about pest control methods and practices have led to the inefficient
use of chemicals and higher costs of cultivation. Farmers’ over reliance on
chemicals and indiscriminate use of pesticides have resulted not only in higher
costs of cultivation but also in environmental pollution and the development of
resistance in insects against many of the insecticides.
The average cost of plant protection primarily against insects is around Rs

2,800 per acre in Punjab and Rs 1,850 per acre in Sindh, respectively—18
percent and 15 percent of gross costs of cultivation. This constitutes the single
most important item of out of pocket (tradable) expenditure in cotton farming, as
shown in Table 3.14. Farmers spray cotton fields five to six times on average
per season and in certain situations the number of sprays may increase to more
than 10 depending on weather and the intensity of pest infestation and quality
(efficiency) of chemicals being used. Excessive use of chemicals besides
polluting the environment has also exposed farm workers in general and cotton
pickers in particular to health hazards. In addition, as manufacturing and the
livestock feed industry use cottonseed edible oil, residues of pesticides on
cottonseed may pose serious health problems.

Average farmers’ cost of production of cotton in Punjab and Sindh, 2004–2005 crop year
Source: Data adapted from APCOM’s Price Policy Report for Cotton 2004–
2005 crop (APCOM, 2004); figures rounded off.
Cotton is also susceptible to several plant diseases that collectively inflict

substantial production losses every year, both in terms of lost production and
lower quality of cotton. Although precise estimates of these losses are not
available, knowledgeable farmers and others well versed in the crop conditions
in the country put such losses at around 10–15 percent of the annual harvest
on average. In serious situations, as experienced in the wake of the leaf curl
virus attack in the 1990s, the losses may be 30–40percent.
In spite of heavy losses in cotton production, farmers are not very familiar with
the early symptoms of the diseases or are unaware of the possible measures to

control them. This is perhaps because the pathogens that cause the diseases
are not always evident on the plants but may be hidden or underground. The
plants may not show early signs of any ill effects of disease but may suffer from
an apparent sudden collapse.
Cotton experts in Pakistan have identified the following among important

diseases: bacterial blight, leaf curl virus, boll rot, stem rot, wet rot, root rot, wilt,
anthracnose, stunting, seed and seedling diseases, Myrothecium leaf spot,
Cercospora leaf spot, Alternaria leaf spot, and nematode diseases (Kamal and
Hussain, 1988). Of all these diseases, bacterial blight, boll rot, and root rot were
generally singled out as the most damaging in Pakistan until the CLCV, which
appeared in the 1990s. The CLCV seems to have overshadowed all other
cotton diseases in the country, and serious efforts have been made to develop
cotton cultivars that are tolerant of or resistant to leaf curl, which caused severe
cotton losses.
Weed Control
Another important dimension of plant protection relates to the control of weeds
in cotton cultivation. Salam and Soomro (1988) identify the common weeds
found in cotton fields in various cotton-growing regions of Pakistan as “itsit”
(Triantberma monogyma), “dela” (Cyperus rotundus), “khabbal” grass (Cynodon
dactylon), “leli” (Convolvulus arvensis), “bhakra” (Taribulus terristris), “dhodhak”
(Eupborbia prostrate), and “tandala/cholai” (Amarantus viridis).
The continuous cultivation in the cotton fields crop after crop without fallowing
and following the same rotation year after year have resulted in high weed
infestation requiring hoeing, intercultural, and the use of chemicals and
herbicides for arresting weed populations to obtain good crop harvests. Weeds
not only compete with crops for moisture, sunshine, and plant nutrients but also
provide shelter to insects. Accordingly, effective weed control is an important
constituent of the good crop husbandry and crop production strategies. The use
of chemicals and weedicides and herbicides are increasingly supplanting or
supplementing traditional methods of weed control, including fallowing, “dab,”
crop rotation, and interculture. However, as most of the farmers do not have
adequate knowledge, background, and training in the judicious use of

herbicides, their indiscriminate use has not yielded the desired results. The
availability of inferior quality and the marketing of substandard herbicides by
unscrupulous traders compound the situation. Notwithstanding the increased
use of chemicals, weeds remain an important constraint in increasing
production and productivity of cotton. The high infestation of weeds and insect
pests takes its toll: resulting in increased expenditure on cost of cultivation and
loss of output; both in quantitative and qualitative terms leading to inefficient
resource use and higher cost of production.
Quality of pesticides/weedicides. Farmers and crop experts in many I and in

the press have expressed complaints and concerns about substandard quality
and adulteration of pesticides. It has also been pointed out that the quality of
pesticides has deteriorated in the wake of local formulation and introduction of
generic pesticides. The government has often expressed its resolve to root out
the adulteration in the pesticides business. The provincial departments of
agriculture have launched periodic, but sporadic campaigns to check the quality
of pesticides in the market against substandard products. Nevertheless,
because of the absence of an effective institutional framework for the
enforcement of quality control, the lack of sustained efforts in this context, and
the resourcefulness of the pesticide companies, the menace continues, greatly
disadvantaging farmers, wasting resources, and diminishing production. To
minimize the quantitative and qualitative losses in cotton production, to reduce
its cost of cultivation, and to prevent environmental degradation, the
establishment of a network of well-equipped, state-of-the-art laboratories and
institutions of quality control standards is a sine qua non.
Bt Cotton
Technological innovations and technical developments, as in other fields, hold
the key to improving productivity for increasing farm production as land and
water resources face tough competition and encroachments from nonfarm
uses. The efficient control of pests has come to occupy a special position in
cotton farming as the crop has become increasingly vulnerable to a host of
insects and diseases. Biotechnology, acclaimed by its proponents as the
technology of the new millennium, has opened new vistas for expanding farm

production and the development of new crop varieties through genetic

engineering. Using this technology, many cotton-producing countries have
developed new cotton varieties tolerant of insects. Bt cotton contains a gene,
derived from soil bacteria (Bacillus thuringiensis) that protects cotton
crop against bollworm by producing a special protein. The bollworms
feeding on Bt cotton leaves become sleepy and lethargic, reducing damage to
the crop plants. Work on the development of Bt cotton varieties in Pakistan has
been in progress for some time. The National Institute of Biotechnology and
Genetic Engineering in Faisalabad has developed an insect resistant Bt cotton
variety that is being submitted for approval to the National Biosafety Committee
under the Biosafety Rules and Biosafety Guidelines enacted in 2005. Under
these guidelines, all GM plant varieties intended for release will be required to
obtain an environmental clearance prior to entering normal testing and release
procedures under the Seed Act of 1976. The Ministry of Food Agriculture and
Livestock was reported in April 2006 to have finalized a strategy to regulate the
release of GM plant varieties including Bt cotton. Subsequently, in January
2007 the ministry planned to release the National Institute of Biotechnology and
Genetic Engineering Bt cotton variety IRFH-901 for use in the next season’s
crop.
Pakistan has lagged behind in the development and adoption of Bt cotton.

Other major cotton producing countries—the United States, China, and India—
have made considerable progress in the development and cultivation of Bt
cotton varieties. In India, the Genetic Engineering Approval Committee
approved the commercial release of three hybrid Bt cottons in 2002. Because of
their higher yield and better fiber quality, which translate into higher cash
incomes, farmers are reported to have quickly adopted the cultivation of the Bt
varieties. The national average cotton yield in India has increased from 294
pounds per acre in 2002–2003 to 391 pounds in 2004–2005, and total
production surged from 10.6 million to 19 million bales (Robinson, 2005). It may
be premature to ascertain the impact of Bt cotton on India’s cotton production
and even worldwide, as the technology is still evolving and in the early stages
of development and adoption. However, Robinson (2005) reported that the
ICAC had estimated that 27 percent of the world cotton area in 2005–2006 was

planted with approved Bt cotton varieties, accounting for about 36 percent of

total production.
In the absence of approved varieties, there is anecdotal evidence to suggest
unauthorized cultivation of Bt cotton varieties in Pakistan, which was allegedly
smuggled into the country so their origins and the extent and scale of their use
are uncertain. However, one thing is very sure: Farmers are not going to wait
indefinitely for approval of its cultivation.
Discussions with some progressive farmers and crop experts suggest

widespread cultivation of the new cotton varieties in the cotton-growing areas of
the Punjab. Visiting Sahiwal around the last week of August 2006, it was
astonishing to see tractor trolleys transporting cotton from farms to
market/ginneries, as it was quite early for cotton picking to have started in this
district. Normally in the Sahiwal district, cotton has been planted from mid-May
to mid-June and picking would start sometime in October. On my enquiry,
farmers informed me about their early planting of cotton, in March or so. When
asked about the pest attack on early-sown cotton, they indicated that the early-
sown crop had escaped serious pest attack, as it was a different variety and
farmers had already taken two or three pickings. Further discussions with the
growers revealed that this was a new breed of cotton variety that had some
“germs” in the plants or leaves that could kill the pests feeding on them.
Obviously, farmers did not know precisely about the development of this new
technology nor its chemistry but had some vague ideas about its salient
features. They were highly appreciative of the savings in plant protection
expenditures on this new cotton, which had escaped the onslaught of major
pests; and only nominal expenses (Rs 300–400 per acre) to control sucking
pests had been involved.
By the third week of August, farmers had taken two or three pickings and had
picked 20–25 mounds (40 kilogram) of seed cotton per acre and were
expecting about the same during the remainder of the season. Thus, yield
expectations were around 40–50 mounds per acre. Cotton was being sold at Rs
1100–1200 per 40 kilograms in the village, and farmers were quite happy with
the income potential.

I visited some cotton fields to have firsthand experience of the situation on the
ground. Cotton sown in March appeared to have escaped major pests and
bollworms. The plants looked quite healthy, bearing flowers and bolls of various
sizes. The boll size also appeared bolder, and plants did not have any
pest infestations. Farmers reported that cotton sown in the normal season of
May–June suffered pest attacks due to the onset of rainy season during the
growing stages of the plants, whereas early-sown crop, having experienced hot
weather in May–June, escaped pest attack. However, there were some plants
with somewhat swollen leaves, as if suffering from some kind of leaf curl virus
disease.
In Sahiwal, the cultivation of hybrid maize, after the harvesting of potatoes in

January/February has been very successful, yielding 80–90 mounds of grains
from one acre of maize. Accordingly, potato–maize rotation has become very
popular with farmers. Nevertheless, the maize prices had fallen to less
than Rs 300 per 40 kilogram in 2006, much less than wheat prices (only 72
percent of the wheat support prices), whereas in previous years maize prices
were quite competitive with wheat. As a result, farmers have been disappointed
as their input prices have been on the rise. In view of the good revenues from
cotton this year and the declining income from maize, some of the maize areas
may be switched over to cotton in the next crop season.
Given the importance of cotton to the economy, it is imperative to monitor the

new developments and ascertain the extent of the cultivation, yield potential,
sources of seed, and characteristics and quality of Bt cotton production. It is
also important to take note of the environmental changes, if any, resulting from
this new development. Formalizing the system with the release of approved
varieties would facilitate its orderly development.

Contamination-Free Cotton
Small farms undertake a substantial part of Pakistan’s cotton cultivation on a

small scale. Women and children handpick the produce from the cotton plants.
In any given location, cotton farmers do not confine their cotton cultivation to
one cultivar but grow many varieties. Cultivation of more than one
variety is the norm even on small farms. During picking and storage, the
different varieties are seldom kept separate. Cotton traders, “beoparis,” and
village merchants purchase cotton in small lots from various farmers. They
seldom transport the produce of different farmers of varying grades/standards
separately but instead mix various lots in the marketing process.
In many cotton-producing districts, until recently cotton was transported in jute,

polypropylene, and plastic bags, resulting in the contamination of cotton with
such materials. Other contaminants in cotton have been human/animal hair,
bird feathers, cotton twigs, unopened bolls, and leaves. Cotton transportation in
open trolley/truck bullock carts has often resulted in catching tree leaves, dirt,
and dust. The open storage of cotton in ginneries on unpaved floors has also
invited contamination from different sources. Consequently, a high degree of
contamination has characterized seed cotton in Pakistan.
As the ginneries rely on old machinery and outdated methods of ginning and
traders and the industry have not offered much premium for quality, ginners
have been indifferent to quality improvements. Lint produced from
contaminated seed cotton has also suffered in terms of quality. The extent of
contamination in certain cases was as high as 19 grams per bale. Therefore,
until recently Pakistani cotton was rated as among the most contaminated
cotton, which adversely affected its price in the international market. To improve
the situation and to produce contamination-free cotton, a project was launched
in 2001–2002 in three districts: R.Y. Khan in Punjab, Ghotki in Sindh, and
Nasirabad in Balochistan. In the ginneries covered under the project that
followed the procedures prescribed by the Pakistan Cotton Standards Institute
(PCSI), contamination was reduced substantially, to only 0.74 to 1.97 grams
per bale. Because of the importance of improved quality, the program was

extended to one more district each in Punjab (Bahawalpur) and Sindh

(Sanghar) and to the whole of Balochistan in 2002–2003. The PCSI-trained
classers to provide the requisite labor for the program.
However, the Cotton Standardization Ordinance, which was launched with

much fanfare in 2002, has not been effectively implemented. The textile
industry has not been willing to pay a premium for higher quality produce and
this has largely held back progress. To improve the quality of Pakistani cotton
and to get better prices in the international and domestic markets, it is
imperative to switch to a quality based system of marketing that provides quality
premiums and discounts.
Pakistani cotton is all handpicked and has good fiber characteristics.

Nevertheless, after ginning, the trash content is still estimated to be around 7–8
percent on average and sometimes as high as 12 percent. In comparison, the
trash content is up to 30 percent in the machine-picked cotton as in the United
States, but when ginned and packed it is only 2–4 percent. Until recently, the
trash content in Pakistan cotton averaged 25–40 grams per bale, which is very
high. To help control this situation, the use of jute bags in the cotton trade has
been banned, which has generated good results
Industry losses due to cotton contamination, 2004–2005

High contamination in the local cotton – a scourge for textiles,
Pakistan, the world’s fourth-largest cotton producer, had to import nearly 4.7
million bales last year after production in the 2007-08 crop year fell to 11.6
million bales against a target of 14.14 million. The country’s cotton output in the
2008-09 crop years is likely to be less than 12 million bales, falling short of a
target of 14.1 million. The decline in cotton yield and area under cotton
cultivation, pest attacks and a shortage of fertilizer were the major factors that
hit production in the 2008-09-crop year.
According to ITMF study on global development of cotton contamination, the

percentage rate of cotton sources contaminated with foreign parts has
continuously increased from 14% in 1989 to 22% in 2007.
As ginning factories fail to upgrade their quality and government campaign to

create awareness about cleaner cotton among farmers also faltered, the
Pakistani exporters continue to pay penalty worth millions of dollars on
defective products produced from contaminated cotton.
A study revealed that the spinners employ a large number of manual labors in
their factories to remove any foreign material from cotton before it goes for
spinning the yarn. Furthermore, they also install expensive cotton
contamination detection systems at the blow room. This results in an increase
in their cost of production, this cost, however, is much lower than the penalty
they have to pay if a contaminant during spinning process is spun and
integrated in the cotton yarn and then into final woven or knitted fabrics.
The contaminated portion might not be detectable in the yarn, but it has
different dyeing characteristics. It is detected when the dye shade on the
contaminated portion is different than the rest of the cotton yarn or fabric. This
contaminated portion might reappear in the yarn or fabric at regular intervals
and spoils the quality of the product.
The foreign buyers lodge and get a claim depending on the percentage of
damage on the product. Although foreign matter detection is routine in spinning

mills, the PP (polypropylene) cleared yarn is becoming the prerequisite for a

high quality standard among buyers and now many buyers specifically demand
yarn cleared from PP from their suppliers.
According to the experience of a Swiss machinery manufacturer, every fifth

machine stop during sectional warping and beam warping is caused by PP
contamination. Polypropylene (PP) and other synthetic foreign matter that is
transparent and identical in color with cotton/wool can hardly be recognized
with conventional, optical foreign fiber clearing. To solve this problem, a sensor
is developed to detect synthetic foreign matter independent of the color of the
yarn and of the foreign matter, for example white and transparent polypropylene
in raw-white yarn as well as finest foreign fibers.
Basic textile exporters say they have to suffer losses of millions of rupees
because of high contamination in the local cotton in addition to incurring
substantial expenses on machinery meant for detecting impurities in the lint and
removing them.
Pakistan produces one of the best cotton in the world. This natural gift of the
Nature is polluted with various contaminants. Foreign fibers made of white or
colorless polypropylene still present a massive problem for the cotton-
processing industry. Other contaminants include bits and pieces of jute bags
and polypropylene bags. The cotton also gets contaminated with hair, shopping
bags, when thousands of small farmers bring the commodity at the doorstep of
wholesalers in the cotton markets. In some cases sand and moisture is also
added in the cotton accidentally or by design to increase its weight.
Cotton is the most important crop in Pakistan and livelihood of millions of

people (directly or indirectly) depends upon its successful cultivation and
processing. There has been considerable improvement during last few decades
in increasing yield per unit of land and improving agronomic properties,
especially fiber quality. However, both yield and fiber quality is still below
international standards.

In order to maintain cotton standards in Pakistan and to ensure production of

contamination free cotton, Cotton Standardization Ordinance was promulgated
on October 4, 2002. Pakistan Cotton Standards Institute PCSI has been given a
central role under the Ordinance to set cotton standards in the country.
Therefore, the implementation of standardization and Grading System at the
grass-root level is vital for the promotion of contamination free and clean cotton
in the country.
5.7 Compliances Issues

Executive Summary:
Compliance is either a state of being in accordance with established guidelines,
specifications, or legislation or the process of becoming so. We are living in an
age where buyers are not only interested in products it, but they also want to
have full information on details in the process. The new world of international
trade is very conscious of ensuring the well being of the stakeholders
associated with business. This includes buyers, suppliers, employees, and the
community, as a whole. Now a days the importers of textile products in the
developed countries demand that the goods they buy should have been
manufactured in textile mills which fulfilled social obligations as envisaged in
the relevant ILO conventions which have been accepted and signed by
Pakistan. Social compliance is therefore mandatory for the industry in general
and textile industry in particular.
In post WTO era, sectors of Pakistani economy particularly industry, agriculture

and services are increasingly exposed to various challenges. One of the major
challenges for low-income countries towards adopting the path of sustainable
development is the limited enterprise capacity to comply with the international
buyers’ requirements. International buyers are increasingly demanding
compliance on quality, safety, environment and social standards.
Compliance to international and national standards promotes enterprise

efficiency and competitiveness through international trade, protects consumers’
rights of health and safety and in turn leads to socio economic development of

economy. Non-compliance to these requirements often results in loss of

business.
Social Compliance Issues

Although the Uruguay round addressed the issue of “Technical Barriers to
Trade” by introducing the Agreement on TBT, but still it provides sufficient room
to impose quality standards, both product specific and process specific.
Foreign Buyers provide their code of conduct and the local Textile Industry has
to make compliance of their standards. The auditors deputed by the foreign
buyers verify the implementation status to qualify trade relationships. Mostly the
issues are derived from local and international Labor Laws – Health and Safety
Standards and Environment Standards viz.
1. Child Labor
2. Forced & bonded labor.
3. Harassment and abuse
4. Health & Safety
5. Trans-shipments quota
6. Verifications
7. Collective bargaining
8. Security concerns
9. Compensation and benefits
10. Custom compliance
11. Working hours.
12. Drug interdiction
13. Discrimination
14. Country of origin
Thus, slowly and steadily compulsion is taking form of business advantage.
 The agreement on Technical Barriers to Trade (T.B.T.) in WTO clearly says

that market access can or should only be restricted through imposition of
standards based on scientific findings and rationale. Practically the
developed countries are at freedom to immediately impose trade

restrictions even to investigate a particular case or an export

consignment.
 Over the past few years the developed countries that have put extra
pressure on the firms in under- developed countries to comply with
environment & health standards have adopted numerous measures.
 There is need to develop awareness amongst all the stakeholders about
the Social – Health - Safety and Environment related issues, the local &
international laws and a commitment to comply with required standards.
 The Government Depts./Ministries/Institution have to synergies their
thinking – policies & action plans to meet the up coming global
requirements and develop clearly spelled out laws facilitating industry to
become compliant to W.T.O./ILO regulations on one hand & remain as
competitive global player on the other.
 The industry mostly exists as SMEs and is likely to face difficulties in
complying with social and environment regulations. These SMEs are not
in a position to comply with any of the present local Social Environmental
Laws, because of their existing contractual system of production to
achieve productivity levels. Similarly the processing industry also is
unable to meet the high cost compliances.
Why is it important for an enterprise to have compliance certification?

Compliance to international standards on quality, environment and social
accountability has been universally recognized as one of the key strategic
elements of product competitiveness in both domestic and international
markets, along with price and delivery factors. Quality is the pre-requisite for
successful market access and for achieving continued customer satisfaction.
The Standards and Quality Management program address the quality related
needs of exporters and concentrate on institutional and capacity development
in the export quality management.
Companies use international standards that either want to implement their own
in-house systems or to ensure that suppliers have appropriate systems in
place. International standards promote international trade by providing one
consistent set of requirements recognized around the world.

These systems and standards define and establish an organization's policy and
objectives. It also allows an organization to document and implement the
procedures needed to attain these goals. A properly implemented systems
ensure that procedures are carried out consistently, that problems can be
identified and resolved, and that the organization can continuously review and
improve its procedures, products and services.
For example, ISO 9000 quality management system can enable your enterprise
to increase profitability and customer satisfaction through reduced waste and
rework, shortened cycle times, improved problem tracking and resolution and
better supplier relations. The primary value of this certification is consistent
delivery of a product or service to a defined standard and improved bottom line
performance. It results into perceived higher quality product/service. The
standards are voluntary or are required by the buyers. ISO certification also has
a significant bearing on market credibility as well. Enterprises wishing to do
business in Europe may have no choice but to adopt it as it is an accepted part
of doing business.
How much does a certification cost to a Company?

The certification firms give quotation of their services in regard of any
certification considering the following factors
 Size of organization
 Number of employees
 Complexity of situation
 Complexity of site.
Certification cost may range from Rs. 50,000 to Rs. 300,000. Moreover,
consultancy services for certification if required may cost ranging from Rs.
100,000 to Rs. 300,000 depending upon the above-mentioned factors.
Consultancy may not be required if the staff is competent for carrying out the
requirements of implementation of a standard.

The major certifying bodies working in Pakistan
 Moody International (Pvt.) Limited

4 H-Annexe, Gulberg II, Lahore, Pakistan
Tele#: +92-42-5872172-77, Fax#: +92-42-5872179-80

 Bureau Veritas Certification

H. No. 43, Block 7/8, Jinnah Cooperative Housing Society, P.O. Box.
3829, Karachi
Tele#: +92-21-111786-013, Fax#: +92-21-5876765, 4392713
www.bvqi.com
 SGS Pakistan (Pvt.) Limited, Systems & Services Certification
22/D, Block 6, PECHS, Karachi-75400, Pakistan
Tele#: +92-21-4540260, Fax#: +92-21-4548824
www.sgs.com.pk
 Pakistan Systems Registrar
119/II, Popular Avenue, Phase-VI, Defense Housing Authority, Karachi-
75500
Tele#: +92-21-5801372-3, 5886024, Fax#: +92-21-4548824, 5889024
 System Certification Centre of PSQCA
http://www.psqca.com.pk/System Certificate Center Introduction.html
 DNV
www.dnv.com
 AITEX
www.aitex.ex
 TUV
www.cert-int.com
Consultancy Firms offer services for compliance in Pakistan
 SGS
www.sgs.com.pk
 PIQC Institute of Quality
www.piqc.com.pk
 BUREAU VERITAS
www.bvqi.com
 URS
www.urscertification.com

5.8 H.R. Development
Overview
Unfortunately this has been an area of neglect by successive governments over
a long period of its history. In fact, this underdevelopment of human capital is
the single most daunting challenge facing Pakistan at present. Unlike other
countries in the region, which have moved to middle category of human
development, index (HDI) Pakistan continues to remain stuck in the low
category. High population growth - one of the fastest in the world – has given
rise to a young dependent population and increased unemployment among the
youth. One half of the population is illiterate making it more difficult to impart
new skills to the ever-burgeoning labor force. The mean years of schooling
remains quite low and has displayed only minor improvements over time. On
the other hand globalization imperatives dictate that the level of schooling and
skill formation should be moving up the curve at a fairly rapid pace. Poor health
status of the majority of the population encourages absenteeism and results in
low labor productivity. Pervasive poverty and inequitable distribution of income
and assets have allowed the benefits of economic growth to be concentrated in
the hands of a small minority of elite generated social and regional inequities
and depleted social capital.
Political instability, religious extremism and sectarian violence in Pakistan can
also be ascribed, to some extent, to poor human development attainment.
Gender disparities in Pakistan have also been a major contributory factor to the
underdevelopment and underutilization of human resources. Every single
indicator – mean year of schooling, literacy ratio, emolument rates and
participation in labor force – show a vast difference among the males and
females. This waste of human capital can be harnessed into a potential source
of productive capital under a proper set of policies and incentives.
Human Resource in the Textile Industry

Human capital formation for the textile industry development is the most critical
area of intervention. In order to achieve high degree of value addition through
making the apparel and textile made-ups sector the engine of exports growth,
focus has to be laid on structured training programs with the objective to

ensure a consistent supply of well equipped manpower.
Current Status of Human Resource

Work force in the textile industry can broadly be classified into four main tiers,
unskilled labor, skilled labor, operators and supervisors and the middle level
management including production and operations managers. According to
estimates the textile industry as a whole provides employment to around 1.4
million individuals, constituting around 40% of the employment of manufacturing
sector in Pakistan. The sector-wise employment estimates are slightly under
estimated due to the reason that a number of process vendors are also
associated with the textile industry. Actual number of employment will be within
the range of 1.4 million to 1.6 million. A greater portion of the employment is
generated by the stitching segment, which constitutes almost 55% of the total
employment and rightly so as this is the most labor intensive process in the
whole textile value chain.
Employment in Textiles
Importance of Labor Skills in Textiles

The skill requirement varies from sector to sector in the textile industry
depending upon the nature of the technical process and the level of complexity
involved. Usually the role of supervisors and operators is of critical importance
in the capital intensive sub-sectors like spinning, knitting, shuttle-less weaving
and processing, whereas the skilled labor has a pivotal role in labor intensive
processes like stitching and power-loom weaving.

Major Issues in Human Resource Development
Lack of Skill Development Facilities

As mentioned previously, the labor force receives on-the-job training in almost
all the sub-sectors. A number of institutes have been established which cater to
the industrial requirement for middle level management. There is however a
huge shortage of facilities to enhance labor skills and produce competent
supervisors who have in-depth knowledge of processes and hands-on
experience. The existing institutions, which are involved in such training
programs, are in dire need of restructuring to up-date their syllabus and
upgrade the training equipment.
Standard of Training
The textiles industrialists believe that the standard of the training programs
carried out by these institutions are not commensurate with the requirements of
the industry. The reason for this is lack of coordination between the institutes
and the industry. The success of such institutes depends upon constant
interaction and an effective feedback mechanism between the two. It is for this
reason that most of the public sector initiatives established in isolation from the
industry has been are unable to deliver.
Lack of a Training Culture

The industrialists consider training as an unnecessary expenditure on their
workforce, which ultimately causes problems for them to retain their labour and
managers. Hardly any textile industrialist in Pakistan invests in training of its
human resource. Lack of good quality training facilities in the country also
provides the industrialist with an additional excuse not to invest in human
resource development.
Absence of a Quality Assurance System

There is no system to evaluate the performance of the training institutes in the
country. There exists wide discrepancy in quality of education provided by
different institutions, even in the same subject. Absence of a quality assurance

mechanism is the main cause of deteriorating education standard of a majority

of textile institutes.
Role of Industry Associations

The Export Promotion Bureau has established some training facilities in
collaboration with the industry association. The Funds for such projects are
provided from the Export Development Fund (EDF), which is collected as a
cases from the exporters. However the decision on establishing new institutes
should strictly be based on an in-depth training need analysis of the industry as
some of the associations stress upon the Government to establish these
institutions without a need.
Training of Trainers
It is important to mention here that bringing in new equipment in these institutes
is not the sole solution to the problem since it is likely to have significant effect
on the human resource development for the textiles industry. These institutes
need overhauling of all the major areas, most important of which is the training
of the trainers, which has been ignored through out the evolution of the textile
industry. The academia in the institutes should be trained and familiarized with
modern methods of education. It would not be incorrect to say that the trainers
are required to brush-up their knowledge so as to keep abreast of the modern
developments in their respective disciplines.
5.9 Post Quota Challenges

Pakistan Knitwear Industry: Post Quota Challenges
A large number of knitting units have stopped production due to ever increasing
cost of inputs in the country. Exports of value-added textiles have been
seriously affected as a result of the end of textile quota regime and severe
competition from India, Bangladesh, China and other countries faced by the
exporters of Pakistan, the reason being subsidies being offered by importing
countries to them as well as incentives offered by their own Governments.
Since the industry had been facing numerous problems in production, such as
technological developments, change in policies and macro-economic factors,

social issues in the industrial markets and shifting market structure of the world
textile industry
Textile and clothing industry is the most important sector of the Pakistan
economy. This sector is the main force behind exports and employment. The
knitwear is playing an essential role in value addition in the Textile sector.
During the year 2005-06 total exports from Pakistan was US$ 1.75 billion which
was almost 12% of national foreign exchange. The use of knitwear has
increased largely due to its low price as compared to cotton and blended cloth
shirts. It is a convenient wearing apparel and easy to wash. Knitted garments
are popular among all over the world, especially in the developed countries,
due to their inherent qualities like softness, coolness, sweat absorbent and
durability.
According to estimates of Pakistan Hosiery Manufacturers Association current

production of knitwear is at the level of 1.1 billion pieces. Out of this production,
60% comprising jersey, knitted fabric, T-shirts, sweat shirts, polo shirts, jogging
suits tracksuits and children outer wear.
USA and the European Union are the two largest markets for garments and
knitwear products. Apparel is a rapidly changing business with very short
product life cycles and consumer preferences. The major thrust of garments
and made-ups exports from Pakistan is on the US market. The European Union
is the second largest market for garment manufacturers from Pakistan. Major
markets that Pakistani manufactures have so for not been able to explore are
the Japanese, Far East and Middle East markets. These markets demand high
product standards and in return offer higher unit price realizations.

The production of garments and made-ups in Pakistan is concerted mainly in

Lahore, Faisalabad & Karachi. In Lahore all major units are vertically integrated
& are involved in knitting, dyeing, finishing & stitching. Major reasons to set up
vertically integrated units are the desire of the manufacturer to have full control
over all the processes involved and to ensure that right products are delivered
at the right time. Specialized and commercial units have not been successful to
position themselves to cater to the needs of the export oriented garment
industry.
Knitting industry is growing at a rate of 15% to 17% annually. In the absence of

proper planning and focused approach towards emerging world textile scenario
the local industry foresees a turbulent and a disastrous era beginning in 2007
when China fully avails WTO’s quota free benefits as at present it is being
restricted at a growth of 8% per annum.
The huge investment of around $6 billion made during last few years, but this
investment did not generate the much needed employment in the country as
most of the investment went into spinning, weaving or investment made by
large industrial groups. This investment did not go to value addition sector
which is also the biggest job provider to skilled and semi-skilled work force,
including women.

The knitwear industry has developed rapidly in recent years. At the start of the
2000’s there have been new investments in the knitwear sector especially in
and around Lahore. Ammar, Klass textile, Ibex, Irfan, Style, Azam, Disco,
Crescent Group, Regent and Saigol Groups, based in Lahore, have set up most
modern production units for knitwear with state of the art technology.
Improvement made during 1990s in knitting technology and techniques in the
processing and finishing have been further improved with dimensional stability
of knitted fabrics. Some high quality machine manufacturers have also imported
soft flow dyeing machines and tension-free dryers.
The locally manufactured machinery is also supplemented with liberal imports
under different modes and export oriented capacity is being developed to earn
much needed foreign exchange. Limits of shrinkage have also been narrowed.
These advancements, together with availability and use of soft twisted spliced
yarn have resulted in the upsurge of worldwide consumption of knitted fabrics.
The knitting technology is a unique and distinct part of the textile industry. In
general, textile mills, which manufacture knitted fabric, do not manufacture
woven cloth.
The distinctive feature of knitting industry is that it comprises highly specialized
machinery and technical skills required to produce various type of knits: for
example machinery used to manufacture sweater bodies cannot also be used
to make hosiery, even though both are knitted products.

Pakistan imported large numbers of automatic flat knitting machines of different

brands. Import of flat knitting machines into Pakistan increased from 857
numbers valued Rs128.1 million in 2002-03 to 2,235 numbers valued
Rs312,387 million in 2004-2005. However, during the year 2005-06 import of
flat knitting machines decreased to 84% in terms of value. Import of flat knitting
machines into Pakistan is given in Table-1 and country-wise import of knitting
machines is given in Table-2.
At present there are about 1,5000 knitting machines working in the country to
manufacture 1.1 billion pieces if knitwear with approximately 60% capacity
utilization. The sector is not only catering for domestic demand, but also has
export potential. There is great reliance on the development of this industry
because of high value addition content in the form of knitwear.
The products made in Pakistan include T-shirts, jogging suits, jerseys, sport
shirts, children wear, gloves, tracksuits, sweaters, socks, etc. The use of
knitwear (Hosiery) has increased primarily due to its low price, as compared to

cotton and blended shirts. It is a convenient wearing apparel and easy to wash.
It requires no vest or under garments due to its inherent absorbent quality.
Knitwear goods exported from Pakistan are known for their fine quality in
European and American markets. A series of new finishing processes have
been incorporated with improved shades, texture and luster. Some of the bulk
export items, which have gained popularity, are 100% cotton T-shirts, vests,
slips, children’s pajama suits, sports shirts, undergarments, bathing suits,
knitted garments and knitted tabulator or flat fabrics.
Manufacturers follow international sizes and specifications. They also welcome
buyer’s samples, specifications and designs.
Export of Knitwear (Hosiery) increased from 40 million dozens worth $911
million in 2000-01 to 79 million dozens worth $1,751 million in 2005-06. Export
of knitwear is given in Table-3. In the international market the USA is the major
buyer, followed by UK, Germany, Netherlands, Italy, Canada, France and
Belgium. Country-wise export of knitwear is given in Table-4


Challenges: Pakistan textile industry is loosing its competitiveness in

international market. Buyers get a low quality service, which reduces their
confidence to do business with Pakistani industry. As such, Pakistani industry
could neither meet the lead time demand of highly profitable textile and fashion
products nor could meet the low price expectation of Western markets.
Despite having state of the art machinery and access to capital, our textile
industry is compelled to manufacture and export raw, non-seasonal and low
value textile products where high capital is required to manufacture at
extremely low margins.
China, India and Bangladesh are strong competitors. In China industrial cities
have grown up, in Bangladesh cash subsidy of 10% is normal plus the industry
is getting incentive for conversion. Sri Lanka built image through its GS. India
has added 14 million spindles in last two years, 5 million spindles have been
installed in Bangladesh where no cotton is grown, expansion of Chinese textile
spinning capacity than twice that of India.
Challenges ahead for the industry are search for new markets and product
segment is non quota countries and other unexplored areas, maintaining
international quality standards, etc. China is the major threat: about 40% of its
total export goes to Japan, which is a non-quota country. The two major
challenges are low level of technology and modernization in textiles and
clothing of Pakistan, which includes the knitwear sector.
As no proper research work has been undertaken, the role of R&D is very much
lacking as there is not much research activity in the textile sector. The only one
Textile Industry Research & Development Centre (TRIDC) set up with UNIDO
assistance by the Ministry of Industry, Government of Pakistan, was closed
down some years back. No textile association has own its research institute. In
India all major associations have their own research institutes, such as the
BITRA in Bombay, ATIRA in Ahmedabad, SITRA and Jute Industry Research
Institute (JIRI) in Calcutta. The other Challenges are given as under:
 Frequent fashion changes.

 Anti dumping policies imposed by major importers.

 Non tariff barriers may increase such as standards relating to child labor,
human rights.
 Comparatively poor image of Pakistani brands aboard.
 Poor presence in non-quota countries and niche markets.
 Increasing wage rates in other ASEAN & Asian countries.
 China under quota system till 2007
 Government bureaucracy and reactive nature.
 Under-developed weaving sector and unorganized processing units.
 Lack of international marketing efforts.
 Higher rate of interest on loans for modernization and expansion.
 Less awareness in acquiring international quality certifications.
5.10 E-Commerce in T & A Industries,

Introduction
The overview of e-commerce activities in the textile and apparel industries, we

begin with a brief look at the current competitive landscape in the bricks and
mortar. Apparel industry, highlighting the changes that have occurred over the
past decade as retailers have adopted. lean-retailing. Business models in
response to increased product proliferation and shorter product life cycles. With
the advent of the Internet, apparel sales have started to move on-line. To
understand how the pattern of growth of on-line apparel sales might differ from
that of other products, we outline some of the critical ways in which the apparel
purchase decision differs from the purchase decision for other consumer
products, such as books and compact disks, which have experienced rapid
growth in on-line sales. In view of these differences, we characterize some of
the new technologies and business practices that are being developed to
facilitate on-line apparel purchasing.
The paper then focuses on business-to-consumer (B2C) business models that

have emerged to sell apparel on-line. We.ll explore a range of B2C business
models, from the introduction of new .pure-play. business models to the

development of on-line strategies by incumbent brick and mortar retailers,

catalog companies, and apparel manufacturers, highlighting some of the
challenges relating to channel conflict and supply chain management that
incumbent firms face as they enter into the world of apparel ecommerce.
We then turn to an analysis of business-to-business (B2B) models that are
beginning to surface, concentrating on the potential benefits of these models to
the operations of the textile-apparel-retail supply chain. We also discuss some
of the different models that are emerging, and how they are related to
differences in channel power.
The Internet has already affected the world of apparel and textiles. Driven to
provide consumer convenience, the majority of apparel manufacturer and
retailers have created a virtual version of some aspects of their current physical
environment. A few apparel manufacturers and retailers have used the internet
to go beyond their existing offerings, providing the consumer with a value-
added internet experience such as customized on-line apparel catalogs and
custom-fit clothing. However, the potential impact of the internet on the
consumer, and on the industry, lies not in what the consumer sees and does on
a computer, but in how retailers and manufacturers leverage the internet to
meet both expressed and latent consumer needs. The technology now exists to
reinvent the textile-apparel supply chain to provide consumers with what they
want, when and where they want it. The barriers to implementation lie more in
the willingness of the members of the supply chain to redefine their policies and
practices to take full advantage of the Internet technology.
Industry Background
The apparel industry can be segmented in several ways that are useful for
trying to make sense of the different business models that characterize the
industry. Cost is one basis for segmentation. A large segment of the apparel
industry competes on cost. To achieve rock-bottom costs, manufacturers
typically pursue production in low-labor cost countries and endure the long lead
times that usually result from low-cost transportation. (The single-minded

pursuit of low costs in general results in longer lead times, since firms try to
minimize costs by manufacturing and shipping in large lot sizes). Lower cost
clothing is typically sold through mass merchants (such as K-Mart and Wal-
Mart).
Firms in the industry choose to sustain increasing costs in order to obtain better
quality (look, feel, fit and durability) or more. fashionable. goods. The degree to
which garments follow the latest trends and fashions (that is, how. fashion
forward. the garment) is the basis for a second type of industry segmentation.
Garments can be roughly classified as basic, fashion-basic, or fashion goods
depending on the length of the product life cycle and the degree of demand
unpredictability for the garment. (See Exhibit 1.)
Exhibit 1: The Fashion Triangle

Source: A Stitch in Time, Oxford University Press,
In recent years, fashion attributes have infused nearly all garment types:
product life cycles are shortening and product proliferation is accelerating even
in the most basic garments. These trends have engendered increasing demand
uncertainty that has changed radically the basis of competition in the textile-
apparel-retail channel. Increasing demand uncertainty has led to the advent of
.lean retailing:. retailers who once purchased large quantities of each item far in
advance of the selling season now avoid the risk of carrying inventory of

increasingly unpredictable items by ordering smaller quantities of each product

in advance and ordering, on a weekly basis, replenishment quantities of those
products that have sold in the previous week. The forces driving lean retailing
are summarized in Exhibit.
Exhibit: Forces driving lean retailing
Lean retailing has driven changes in both information and product flow,
resulting in the changes in manufacturing and logistics practices indicated in
Exhibit 3 below. Exhibit 3a shows the structure and dynamics of a more
traditional channel, designed primarily to minimize production and distribution
costs. Exhibit 3b depicts the channel associated with lean retailers, designed to
lower the risk of delivering a plethora of apparel products to retail. Lean retailing
practices have in many ways paved the way for e-commerce, by requiring and
exploiting the use of various critical technologies, streamlining the supply chain,
promoting information exchange in the supply chain, and requiring smaller
quantities of products to be manufactured and shipped in response to
actual consumer preferences.
Exhibit 3a: Channel Structure: Traditional Retailer-Supplier Dynamics

Exhibit 3b: Channel Structure: Lean Retailer-Supplier Dynamics

Source: A Stitch in Time, Oxford University Press,
Lean retailing has been facilitated greatly by the introduction and maturation of
several key technologies:
1. Product identification using bar coding and point-of-sale scanning, used to

provide immediate, accurate information on which products have sold;
2. Electronic data interchange (EDI), used by the retailer to place replenishment

orders quickly and accurately; and
3. More sophisticated, often automated distribution centers, which allow

manufacturers to pick and pack small replenishment quantities based on EDI
orders.
As noted above, these technologies, and the business practices associated

with them, form the underpinnings for many of the critical technologies and
practices required for effective implementation of e-commerce strategies.

Distinctive Aspects of the Textile and Apparel Industries:
Factors Affecting E-Commerce Adoption, A number of distinctive aspects of the

textile and apparel industries provide challenges to the implementation of
electronic commerce.
First, and perhaps most important, is the difficulty of accurately characterizing

the product on-line. Many of the characteristics of a garment that are pivotal in
the consumer decision-making process -- color, touch and feel, and fit -- are
difficult, if not impossible, to communicate virtually. Moreover, unlike books,
music, and consumer electronics, the difficulty in describing the product cannot
be offset easily with customer reviews, reviews by industry experts, or
comparisons based on independent performance evaluations. (Although for on-
line purchases, like catalog purchases, brand names help consumers infer
certain aspects of quality or fit, especially for consumers making repeat or
replenishment purchases.) These obstacles likely will act more as a deterrent in
the B2C segment of electronic commerce than in the B2B segment, since
industry standards for characterizing color and fabric will be more familiar forms
of communication for business partners than for individual consumers.
Compounding the difficulty in characterizing the product is the personal, often

emotional nature of an apparel purchase. Apparel purchasing decisions are
closely linked to individuals. Feelings about themselves, their body image, and
the image they wish to project. Clothing is the .skin. a person chooses to wear
to project his or her self-image to the public, and hence is intimately tied to
one’s sense of self. Thus the decision can be laden with emotional factors that
are less important in decisions to buy books, music, food, and electronics.
An analysis by Harris Interactive ecommerce Pulse computed the ratio of

dollars consumers spent off-line as a result of on-line shopping to dollars spend
on-line. The greater the ratio, the more likely that on-line shoppers use internet
shopping sites to gather information about products, rather than to make direct
purchases. It is not surprising that for this measure apparel led the list of
categories studied: for every dollar spent on apparel on-line, consumers who

visited on-line apparel sites spent $2.92 purchasing apparel from catalogs or
brick and mortar stores. Lower on the list are products that are easier to
specify: computer software (off-line to on-line ratio = $0.99); health and beauty
products ($0.93); music/video products ($0.83); and books ($0.68).
More fashionable items may be more risky to purchase on line: the decision to
purchase online is more significant because of the increased importance of
touch and feel, color and cost, and the increased emotional element associated
with more fashionable clothing. However, the Internet is expected to penetrate
the fashion segments of the market, in part because it will provide exposure
and access to unique or unusual products that are hard for consumers to find
locally. The ability to customize clothing for fit, fabric, or style should also
provide an impetus to increase on-line sales of fashionable garments.
Business-to-Business E-Commerce Models in the Textile-Apparel-Retail Channel
The potential benefits from successfully leveraging web-based B2B models in

the textile and apparel industries are tremendous. With increasing product
proliferation and shorter product life cycles, these industries incur significant
excess costs in the form of inventory carrying costs, stock out costs, and
markdown costs.
Exhibit: Apparel Supply Chain-B2B Opportunities

Improving, visibility in the supply chain for proper distribution, product

identification, must be detailed, virtual model, zoom technology, sizing
information and discounting that all factors are important to attract the
customer.

Chapter 6: CONCLUSION & RECOMMENDATIONS
6.1 Conclusion
6.2 Recommendations

Chapter 6: CONCLUSION & RECOMMENDATIONS
6.1 Conclusion,
The W.T.O. aim is to progressively lower the barriers to world trade through
multilateral agreements. Classic economic theory suggests that the global
economy will grow faster if trade barriers are removed, leaving people and
countries to focus on the things they can do best. But will trade be truly free and
fair by then? It is doubtful.
1. Many developing countries have longer time frames for opening their
markets.
2. Tariff barriers remain high on some products, even in developed economies
such as the USA.
The Industry has potential to perform better. There is need that both
Government and industry should realize that a sincere and appropriate
approach has to be made to meet the challenges of the present day competitive
environment and future scenario when textiles and clothing sectors are to be
fully integrated where quality of product would be the major aspect to
customers satisfaction besides price and after sales service. Investment in
knowledge of markets, training of workers, improvement in labor productivity
and product development would be immediate areas for each to concentrate.
The Government has to ensure:
 Stable macro economic environment.

 Adequate finance for capital investments and working capital.
 Consolidation of Federal/Provincial/Local Government Taxes and
collection at one source.
 Rationalization of the existing policy frame work and gradually
developing a long term policy environment facilitating for long term
project and business planning without economic shocks.

 Motivation to higher value addition within the chain as well as each

product group.
The industry has to:
 Redevelop competitiveness by improving productivity – reduce wastages

and thus lower cost of production.
 Expand product base within each sub-sector at par with other
competitors.
 Develop marketing strength by adopting aggressive marketing
strategies.
 Focus on emerging marketing of developing countries, which offer
opportunities with opening up of the markets under W.T.O. regime.
Human Resource Development

Investments in physical and technological resources will have to be matched by
equivalent investment in the development of human resources, an area where
local industry has been lacking with severity. The problems of low productivity,
inefficiency and quality can be solved only if investments are made in
equipment as well as human resource development.
International Standard Cotton

Since Pakistan’s textile potential is based on availability of local raw materials,
this comparative advantage can only be exploited fully if the cotton lint available
at the ginning factory gate is of international grades and quality standards.
Currently Pakistani cotton falls short of this ideal. Unless quality standards (and
consequent relation of quality to price) are ensured, the textile potential will not
be realized
Shift to Value Addition

Value addition is a pre-requisite if Pakistan wants to attain a dominant position
in the global textile arena. Value addition in the textile sector can be achieved
vide a two pronged approach. Firstly by changing the product mix, e.g. in
spinning switch from manufacturing of low counts yarns to finer counts yarns

and secondly by moving into the exports of high value items i.e. garments and
made-ups.
Shift to Man Made Fibers
Globally there is a shift of production from pure cotton based textiles to blended
and synthetic textile products. In case of cotton fabric the total global production
has been stagnant for the last ten years. Similarly the global man made fiber
consumption has also increased from 48% to 59% whereas the share of cotton
fiber has declined. In Pakistan the consumption of man made fibers is very low.
For spinning only 18% of the total spindle capacity is used for man made fibers
in Pakistan, whereas in India 40% of the total spindles are run on man made
fibers. A very low proportion of Pakistan's textile exports comprises of pure
synthetic products, whereas the market for these products is much bigger than
that of cotton and blended textile products. Again the focus of the strategy will
have to be on the production of blended and synthetic textile products which is
the area of future growth.
Knitted Garment Sector
Like the weaving sector, the knitted garment sector has been considered an
ancillary of the spinning sector. This sector is largely fragmented and mostly
faces the same problems as faced by the weaving sector i.e. low price
realization, poor quality, lack of international exposure, etc.
To increase the productivity of this particular sector, it is recommended to:
 Reduce the dependency on the buyers
 Innovate
 Focus on the potential customers/markets
 Standardize operations and manufacture product of even quality
 Carry out appropriate processing design and equipment layout on the
basis of process analysis,
 Ordering of process steps, and measurement of standard times for each
product line.
 Improve and standardize processing on the basis of analysis of
operations, and implement training of

 Operators to increase their knowledge and understanding in finished

products.
Product quality levels are low
Upgrade the basic production of technology of patterning, cutting, sewing and

finishing use blank materials of high quality, increase the variety of blank
materials used such as woven clothes of fine count, plain dyed cloth etc.,
increase the brightly colored materials. Use accessory items of good quality
(buttons, lining, etc.) of good quality, encourage and increase exchanges and
contact concerning design and technology with overseas bodies.
Maintenance and supervision of equipment is insufficient

Implement daily checks of equipment and servicing operations.
 Shortage of well trained personnel in technology and management
 Trained engineers are required who can plan process design and
production schedules
Marketing of Apparel
 Focus on E.C and the USA Markets

 The existing share in the E.C and USA lower-end markets should be
increased and mass production markets should be entered through the
development of distinctiveness in its products
 Effective approach to R&D
Direction for Human Resource Development
 The number of middle management should be increased and basic

education should be improved.
 Systems for technical instruction and personnel training should be
reinforced.
 Salaries of instructors should be reviewed. There should be
improvement in facilities and equipment provided to educational and
training institutes. Technical experts from all over the world should be
invited for this purpose.

6.2 Recommendation,
Critical Country Perceptions

Since a pectoral strategic development plan has to operate within the broad
environmental canvas of the country or the region, there are many extraneous
factors that have a profound influence on the operational aspects of the
strategy, sometimes in an absolutely critical way. The proposed textile vision
2005 assumes that none of these factors will play a hostile role as the
implementation phase unfolds. An enabling backdrop is a vital pre-requisite to
the viability of this strategy. The main factors that will effect the outcome are
listed as under:-
Supportive External Factors

The role of International bilateral and multilateral donors is critical in developing
perceptions about the economic health of a country, particularly less developed
countries (LDCs). These external factors prove to be very supportive provided
the donors have a positive opinion and vice versa.
Business Environment
Another crucial factor in stimulating foreign as well as domestic investment is
the investment policy of a country.
Investor friendly business environment refers to the set of incentives and the
comfort level in business operations
offered to investors.
Country Image
Pakistan is globally perceived to be a low quality producer. Even if an 'A' grade
product is manufactured, according to international quality standards, it still is
not able to fetch a better price in the international markets. A negative country
image discourages the switch from low value added products to higher value
added products.

Procedural and Regulatory Barriers

Pakistan’s economy is considered to be amongst the highly regulated
economies in the world. An entrepreneur has to deal with a wide range of
different Government agencies to run an enterprise. Similarly a cumbersome
procedure of the Government departments discourages the use of various
packages offered to facilitate the business, especially exporters. Cases in point
are the No Duty No Drawback (NDND) scheme and other programs related to
temporary imports.
Political Stability
Last but not the least is the political stability in the country. Pakistan is
considered to be a high-risk country due to political instability. Frequent
changes at the top result in reversal or termination of policy measures.
Investment and Capital accumulation can only take place through guaranteeing
the continuity of different initiatives and policies undertaken by a regime.
General Interventions
Textile is a mega-sector with a long value chain. Each of the sub sectors in this
value chain has very specific impediments to its optimum development and
growth against which Textile Vision has suggested detailed workable
recommendations. There are also certain limitations that affect the Textile
sector on the whole. These problems are generic and concern each fob of the
value chain. Therefore common interventions that will impact all the sub-sectors
across the textile industry are listed and discussed together in the General
Intervention package.
Monitoring of textile industry performance

Currently there is no system in the country to monitor the performance of the
textile sector on a regular basis. Such actions are initiated as need arises. The
Textile Board with the support of its specialized wings would be in a position to
analyze the performance of the industry and set annual production targets. It
would also evaluate the export performance of the sector.

Technology Up-gradation needs analysis

Competitive advantage is the key to success in the textile business.
Considering the dynamic nature and diversity of technology in various sub-
sectors of textiles, there is strong need to create awareness among the
industrialist about technological advancements and process improvements. The
Textile Board would play this role by conducting up gradation need analysis
across the textile value chain. At a large scale the Board would also facilitate
the transfer of technology in the country.
Effective Marketing of textile products

Marketing has been a major issue for all the exporting industries in the country.
EPB's effort in this regard is diluted due to its responsibility to promote exports
from all the sectors. Furthermore there is a major perception problem regarding
the image of the country, the 'Made in Pakistan' label on an 'A' grade textile
product results in low price realization. Marketing of textile products will be the
role of Textile Board, it will explore new markets for Pakistani products; provide
marketing support to the industry in introducing new products. It will also co-
ordinate with the EPB in its activities and ensure the representation of the
textile industry in international events. In order to improve image of Pakistan's
textile products the Board would have to rely on marketing and advertising
through international electronic and print media.
Industry Training Need Analysis

A number of training institutes are currently present, which impart training on
different textiles subjects such as spinning, processing, etc. These institutions
are in a dire need of restructuring to equip them with modern training facilities
and update the syllabus. This is vital to the transformation of the textile sector to
exploit the opportunities arising out of MFA phase out. The textile board will
conduct a training need analysis of the textile sector to meet its future
requirements and will carry out the task of restructuring of institutions
accordingly. If need be, new institutions will also be setup by the board.

Textile Quality Standards

Quality of textile products is crucial to improve the image of Pakistan textile
industry internationally, which currently is the perceived to be the lowest. The
quality standards of a wide range of textile products are non-existent.
The textile board will have the task to formulate product standards for textiles
and implement them. Similarly the MFA phase out and lowering of tariff barriers
will start a new phase of non-tariff barriers for the exporters of developing
countries, these include quality system compliance with ISO, standards of
engagement, child labor and environment standards. This will be another
important function of the board to facilitate the industry gear itself and compete
globally.
Textile Industry Statistics

Accurate and detailed statistics provide sound foundation to a realistic analysis.
Under the existing situation there is no system of collecting statistics on a
regular basis and, across the textile sector value chain. The statistics on the
formal sector only does not give a complete picture. One of the functions of the
textile board will be to gather statistics not only on the formal sector but also on
the informal textile sector including the power looms, small dyeing units,
stitching units and other process vendors. The board will serve as a hub of
information to the textile industry for international trade statistics (import
exports) which form the basis of export marketing.
Promote investments in the textile sector

Currently in the textile industry of Pakistan there is no direct foreign investment
(DFI). Even the export processing zone concept has failed to attract foreign
investment in the country. There is only one joint venture in the mega industrial
sector of the economy, whereas, countries like Indonesia, Bangladesh and also
India have a number of joint ventures in the textile sector. It would be the
responsibility of the textile board to devise strategies so as to attract foreign as
well as local investment in the textile sector. The concept of Textile City would
also be developed by the board to promote joint ventures and foreign
investment in the textile sector.

The Board should be headed by a full time Chairman preferably from the
Private Sector who is well versed in project management techniques and can
take full responsibility for the implementation of the strategy. For this he will
require full commitment and support from the highest office in the country. The
membership of the Board must have a private sector bias with the inclusion of
industry representatives.
Anti Dumping and Countervailing Duties

The Ministry of Commerce should upgrade its institutional arrangements and
expertise to deal with complex issues involving anti-dumping issues and
countervailing duties arising as a result of global integration. Interestingly,
majority of anti dumping cases in the WTO are on Pakistan's export of textiles.
It is important for the Government to continuously monitor the imports of various
textile products into the country, to take notice of dumping from other countries.
International Exhibitions
International exhibitions and trade shows provide an excellent opportunity to
gain access to new markets, increase penetration in existing markets and
introduce new products. By ensuring participation in trade related international
events export growth can be enhanced to a great extent.
The Export Promotion Bureau has policy of sponsoring exporters from various
sectors to these international trade fairs and exhibitions. It is observed that
there are no set criteria of the selection of participants for such events, which
sometimes results in building a negative country image. In this regard it is
proposed that EPB should lay down certain standards for participating in trade
fairs and preference should be given to the exporters of high value added
quality textile products.
International Standards Compliance

The implementation of WTO and the MFA phase out will start another era of
non-tariff barriers for the developing countries. The non-tariff barriers consist of
a long list of standards and social issues including, child labor, terms of
engagement, environment and other quality standards like ISO 9000 & 14000,
CE marking, etc. Already the Ministry of Science & Technology is providing a

cash incentive of Rs. 200,000 for ISO certification. It is proposed that firstly the
application of this cash incentive on quality standards compliance should be
broadened and other standards should also be made a part of the scheme.
Secondly, Ministry of Industries and the Ministry of Science and Technology
should jointly work out a program of educating and creating awareness among
the exporters regarding the negative impact of the upcoming non-tariff barriers.
E-Commerce
The increased use of Internet has transformed the world into a global village.
Besides being the biggest source of information, Internet is also nowadays
playing an instrumental role in business transactions. Numerous organizations
are actively developing databases to facilitate business-to-business commerce
and trade (B2B Commerce). The concept is based on creating a virtual
marketplace for the buyers and suppliers. In order to achieve the desired
targets and quantum leap incentives should be given to promote the use of
internet in the industry. To initiate the process awards may be given to best
textile web sites, transactions/exports materialized through B2B commerce can
be rewarded through additional quota allocations and free participation in trade
fares.
Export Recommendation,
Long term, Fixed Rate, and export Oriented Projects Financing Scheme- to
enhance the production capacity.
 Financial Support for compliance certifications for international quality,

environment and social standards.
 Research and Development Support for the textile sector, leather
garments & footwear, and to motorcycle industry on export of their
products.
 Assistance for opening exporter's offices abroad.
 Support for marketing of branded products.
 To encourage investment and facilities exports, scheme of export-
oriented units has been introduced.

The Government has to ensure:
 Stable macro economic environment and adequate finance for capital

investments and working capital.
 Consolidation of Federal/ Provincial /Local Government taxes and
collection at one source.
 Rationalization of the existing policy frame work and gradually
developing a long term policy environment facilitating for long term
project and business planning without economic shocks.
 Motivation to higher value addition within the chain as well as each
product group.
The industry has to:
 Redevelop competitiveness by improving productivity – reduce wastages

and thus lower cost of production.
 Expand product base within each sub-sector at par with other
competitors.
 Develop marketing strength by adopting aggressive marketing
strategies.
 Focus on emerging marketing of developing countries which offer
opportunities with opening up of the markets under W.T.O. regime
Recommendation of water crisis
 Fast track implementation of 3 mega canals projects namely; Kachhi

Canal in Balochistan, Rainee Canal in Sindh and Greater Thal Canal in
Punjab for irrigating 2.864 million acres.
 Substantial completion of Mangla Dam Raising Project for additional
storage of 2.9 MAF and additional power of 120 MW.
 In drainage sector fast track implementation of RBOD-I, II & III Project to
protect and reclaim

Water plays vital role in improving per acre yield. Increase in water supply being
a key input is required to raise cropping intensity and enhance
 The income of the farmers: Since inception, ZTBL (Zarai Taraqiati
Bank Limited) has financed over 144,478 tube wells by disbursing
over Rs 14,713 million. For raising irrigated area to accelerate the
economic growth and to facilitate the farmers, ZTBL will also provide
loans to farmers for installation of tubewells/turbines.
Focus on Value Addition

Pakistan is a leading exporting nation in raw yarn, cotton, and fabrics. If we
emphasis on the value added products like garments, Hosiery, knitwear and
other textile made-ups, the export volume of textiles can be increased by
manifolds. In this respect top priority should be given to stitching industry that
leads to highest value addition and employment generation

BIBLIOGRAPHY
 GOVERNMENT OF PAKISTAN, MINISTRY OF INDUSTRIES & PRODUCTION

TEXTILE COMMISSIONER’S ORGANIZATION
(FEDERAL TEXTILE BOARD)
 http://www.pakistaneconomist.com/pagesearch/
 http://www.sbp.org.pk/library/FreshArrivalsBulletinPart
 http://www.finance.gov.pk/admin/images/survey/chapters/03-Manufacturing
 http://www.ptj.com.pk/Web%202007/10-07/10-07-PDF/briefs.
 http://ptj.com.pk/newsite/editorial/Issue_01_2007/apparel-and-knitwear-
sectors
 http://www.aptma.org.pk/Reviews.asp
 http://www.pakistan.gov.pk/divisions
 http://www.pakistaneconomist.com/pagesearch/Search-Engine
 Gul Ahmed Textile Mills & Apparel Division
 www.smeda.org/ISC-renewable-energy-textile-sector
 www.ishrathusain.com/speeches/economicManagementPolicies
 www.tco.gov.pk/Webs
 www.paksearch.com/Government/STATISTICS
 Shar Pak (Pvt.) Ltd.
 Apparel Buying Services.

Project For Textile Apparel Ind Future Challenges in Pakistan

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Textile & Apparel Industry, Evaluation & Future Challenges in Pakistan

INSTITUTE OF BUSINESS AND TECHNOLOGY

Textile & Apparel Industry, Evaluation &

Muhammad Tauqeer Ahmad

Course Code : MKT- 606

Institute Of Business & Technology 1

INSTITUTE OF BUSINESS AND TECHNOLOGY

ABSTRACT SUBMITTED BY: Muhammad Tauqeer Ahmad

DISCIPLINE: MBA (Marketing)

TITLE OF PROJECT REPORT: Textile & Apparel Industry,

MONTH OF SUBMISSION: December 2008

NAME OF PROJECT SUPERVISOR:

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 Mr. Finance Manager

I deeply grateful thanks to the staff of different industries that unconditionally

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Chapter: 2 TEXTILE INDUSTRY IN PAKISTAN 12

2.1 History of Textile Industry in Pakistan 13

Chapter: 3 EXPORT PERFORMANCE 37

3.1 Over view 38

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Chapter: 4 WEAKNESS OF GLOBAL TEXTILE 66

4.1 Global Challenges, over view 67

Chapter: 5 FUTURE CHALLENGES 71

Chapter: 6 CONCLUSION & RECOMMENDATIONS

6.1 Conclusion 130

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1.2 Purpose of Study

1.3 Research Objectives

1.4 Research Methodology

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T he textile & apparel industry of Pakistan is going towards a difficult stage

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other countries like India and Bangladesh. Pakistan’s knitwear industry

There is a severe shortage of qualified professionals in the apparel and knit

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1.2 Purpose of the Study

1.3 Research Objective

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1.3 Research Methodology,

The following steps were taken to execute the study:

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Chapter 2: TEXTILE INDUSTRY IN PAKISTAN

2.1 History of Textile Industry in Pakistan

2.7 Made-Up Textiles

2.8 Hosiery & Readymade Garments

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2. TEXTILE INDUSTRY IN PAKISTAN

2.1 History of Textile & Apparel Industry of Pakistan,

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Iran. The latest available date on overall export performance of Pakistan

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Apparel manufacture is an important value-added sector of the textile industry

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World textile fiber consumption in 1998 was approximately 45 million tons. Of

Pakistan’s economy is mainly dependent on cotton and textile sector. It is,

World cotton production is estimated at 118.8 million bales in 2007-08 - 3

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Production and Yield of Cotton,

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