Pakistan’s Textile Exports to Surge as Orders Move From Rivals

[peagle]

Pakistan’s Textile Exports to Surge as Orders Move From Rivals
Shipments set to hit record this year, commerce aide says
Nation plans to roll out incentive for exports to new markets
Workers at warehouse of a textile manufacturer in Karachi, Pakistan.
Workers at warehouse of a textile manufacturer in Karachi, Pakistan.Photographer: Asim Hafeez/Bloomberg
ByFaseeh Mangi and Kamran Haider+Follow
30 January 2022, 08:33 GMT
Pakistan’s textile sector is bringing cheer to its flailing economy, with exports set to swell to a record after gaining an edge over South Asian rivals during the pandemic.

Textile exports are poised to surge 40% from a year earlier to a record $21 billion in the 12 months ending June, according to Abdul Razak Dawood, commerce adviser to Pakistan’s prime minister. Dawood predicted that figure would expand to $26 billion in the next fiscal year, surpassing the nation’s total exports last year, he said.
View attachment 812217
Abdul Razak DawoodPhotographer: Asad Zaidi/Bloomberg
The textiles industry -- which supplies everything from denim jeans to towels for buyers in the U.S. and Europe -- is one of the country’s few economic bright spots. Textiles amount to about 60% of Pakistan’s total exports and the nation allowed its factories to open ahead of India and Bangladesh when the pandemic first emerged in 2020, drawing orders from global brands including Target Corp. and Hanesbrands Inc.

“A lot of orders actually were shifted from Bangladesh and India to Pakistan” during the pandemic, said Dawood in an interview at his Islamabad office. “The other good thing that’s happening is we are now becoming competitive with Bangladesh. Three, four years ago, Bangladesh was really beating us.”

Taking Off
Pakistan's textile exports forecast to reach all-time high for two years


Source: Commerce adviser estimate, Pakistan Bureau of Statistics

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Pakistan’s Textile Exports to Surge as Orders Move From Rivals
Shipments set to hit record this year, commerce aide says
Nation plans to roll out incentive for exports to new markets
Workers at warehouse of a textile manufacturer in Karachi, Pakistan.
Workers at warehouse of a textile manufacturer in Karachi, Pakistan.Photographer: Asim Hafeez/Bloomberg
ByFaseeh Mangi and Kamran Haider+Follow
30 January 2022, 08:33 GMT
Pakistan’s textile sector is bringing cheer to its flailing economy, with exports set to swell to a record after gaining an edge over South Asian rivals during the pandemic.

Textile exports are poised to surge 40% from a year earlier to a record $21 billion in the 12 months ending June, according to Abdul Razak Dawood, commerce adviser to Pakistan’s prime minister. Dawood predicted that figure would expand to $26 billion in the next fiscal year, surpassing the nation’s total exports last year, he said.




Abdul Razak Dawood Interview
Abdul Razak DawoodPhotographer: Asad Zaidi/Bloomberg





The textiles industry -- which supplies everything from denim jeans to towels for buyers in the U.S. and Europe -- is one of the country’s few economic bright spots. Textiles amount to about 60% of Pakistan’s total exports and the nation allowed its factories to open ahead of India and Bangladesh when the pandemic first emerged in 2020, drawing orders from global brands including Target Corp. and Hanesbrands Inc.

“A lot of orders actually were shifted from Bangladesh and India to Pakistan” during the pandemic, said Dawood in an interview at his Islamabad office. “The other good thing that’s happening is we are now becoming competitive with Bangladesh. Three, four years ago, Bangladesh was really beating us.”

Taking Off
Pakistan's textile exports forecast to reach all-time high for two years


Source: Commerce adviser estimate, Pakistan Bureau of Statistics




Read more: Opening Early Helped Pakistan Boost Exports During Pandemic

The government also plans to announce a proposal next month that will likely provide incentives for exports to new markets such as Africa, South America and Central Asia, Dawood said. The nation is doubling down to boost textile exports through measures including tax breaks, cheap loans and supplying electricity at rates that are comparable with rivals in South Asia. A 60% decline in the local currency against the dollar since 2018 has also helped.

“Pakistan’s exports have become competitive over the past few years,” said Ahfaz Mustafa, chief executive officer at Ismail Iqbal Securities Pvt. “There is a fixed energy tariff regime that keeps in mind regional prices, the government is much quicker to refund the money it owes exporters and there has been a giant currency devaluation.”

‘Under Pressure’
The South Asian nation is looking to increase its exports to get out of its regular boom-bust economic cycles that have led it to seek an International Monetary Fund program 13 times since the late 1980s. It’s also trying to revive a $6 billion bailout program to meet financing requirements amid a record trade deficit.

Pakistan’s commerce adviser said there is “very little” that can be done about the nation’s record-high imports, which are driven mainly by purchases of petroleum products such as gasoline, gas and vaccines that are essentials. Pakistan will be “under pressure” if oil hits $100 a barrel, Dawood said. He does expect food-related imports to decline this year following a better domestic crop harvest.

The nation’s also pushing to intensify trade with Central Asia nations by signing agreements and allowing free movement of trucks. Trade has already grown to $120 million in six months of the current fiscal year from $14 million in the entire preceding year, he said.

At last a good news we can actually celebrate. There is still far to go, but this development is definitely something substantive.

 

[Pak Nationalist]

our cotton industry moved to BD when zardari era failed to provide power when pakistan have 15 hours power cut . now as we are power surplus things are getting better day by day . how stupid people are whom still wanna vote those most useless parties .

So you actually believe that power shortage was created the day the Zardari govt took office? Interesting. I have no love lost for PPP but Iftekhar Choudary was striking down their efforts to install capacity right and left. You seem to have been quite young back then to remember all this.

 

[ARMalik]

It is great to see exports surging. However, I have a few questions:

1- How does this benefit the government Tax wise?? How does the government expect to tax these thieves?

2- How will the government manage the Dollars, Euro, etc flowing through?

3- How is this GOING TO BENEFIT THE COMMON PERSON??? How does profit of these fat corrupt rich actually benefit the common person of Pakistan?

 

[Hakikat ve Hikmet]

Pak should be targeting a 100b$ a year textile industry including synthetics, hybrids, cottons etc. along with advanced machinery and enhaced cotton production. If needed take help from China since labor cost is fast rising there....

 

[Patriot forever]

If these projections hold merit, why is the textile policy still not being unveiled which could give confidence to manufacturers to expand capacity at an even quicker pace?

Global energy situation uncertainty coupled with the IMF programme.

Give or take few months it will be implemented.

 

[Meengla]

Music to my ears! My dad's name is still literally etched into a concrete pillar as the foundations of the family textile mill was being laid in Karachi, with '1951' added to his name by him as a teenager. The mill is doing really well. In fact, my brother has his own side smaller textile factory which is doing well now after he moved it from a location where power outages were common to a place where power, though expensive, is at least reliable.
Pakistan lost a lot because of electricity shortages some years ago.

 

[AsifIjaz]

Alhamdullilah current trend is positive for Pakistan. There are but many challenges that may turn out to be our achilles heel in the longer run.. e.g. availability of cotton, yarn, synthetic fiber and other organic source of fiber are the areas of concern.
Some of the big players in Pakistan are vertically integrated and the latest investment due to covid era subsidies will further improve the situation for some. The industry, especially the big players, now need to integrate horizontally for sustainable growth. We need to enter specialised areas where ROI is higher and has less global players.

 

[MultaniGuy]

Pakistan’s Textile Exports to Surge as Orders Move From Rivals
Shipments set to hit record this year, commerce aide says
Nation plans to roll out incentive for exports to new markets
Workers at warehouse of a textile manufacturer in Karachi, Pakistan.
Workers at warehouse of a textile manufacturer in Karachi, Pakistan.Photographer: Asim Hafeez/Bloomberg
ByFaseeh Mangi and Kamran Haider+Follow
30 January 2022, 08:33 GMT
Pakistan’s textile sector is bringing cheer to its flailing economy, with exports set to swell to a record after gaining an edge over South Asian rivals during the pandemic.

Textile exports are poised to surge 40% from a year earlier to a record $21 billion in the 12 months ending June, according to Abdul Razak Dawood, commerce adviser to Pakistan’s prime minister. Dawood predicted that figure would expand to $26 billion in the next fiscal year, surpassing the nation’s total exports last year, he said.
View attachment 812217
Abdul Razak DawoodPhotographer: Asad Zaidi/Bloomberg
The textiles industry -- which supplies everything from denim jeans to towels for buyers in the U.S. and Europe -- is one of the country’s few economic bright spots. Textiles amount to about 60% of Pakistan’s total exports and the nation allowed its factories to open ahead of India and Bangladesh when the pandemic first emerged in 2020, drawing orders from global brands including Target Corp. and Hanesbrands Inc.

“A lot of orders actually were shifted from Bangladesh and India to Pakistan” during the pandemic, said Dawood in an interview at his Islamabad office. “The other good thing that’s happening is we are now becoming competitive with Bangladesh. Three, four years ago, Bangladesh was really beating us.”

Taking Off
Pakistan's textile exports forecast to reach all-time high for two years


Source: Commerce adviser estimate, Pakistan Bureau of Statistics

Bloomberg
Subscribe
Cut through the chaos with real time updates on the news affecting the global economy. Enable Notifications.
Enable Later
Markets
Pakistan’s Textile Exports to Surge as Orders Move From Rivals
Shipments set to hit record this year, commerce aide says
Nation plans to roll out incentive for exports to new markets
Workers at warehouse of a textile manufacturer in Karachi, Pakistan.
Workers at warehouse of a textile manufacturer in Karachi, Pakistan.Photographer: Asim Hafeez/Bloomberg
ByFaseeh Mangi and Kamran Haider+Follow
30 January 2022, 08:33 GMT
Pakistan’s textile sector is bringing cheer to its flailing economy, with exports set to swell to a record after gaining an edge over South Asian rivals during the pandemic.

Textile exports are poised to surge 40% from a year earlier to a record $21 billion in the 12 months ending June, according to Abdul Razak Dawood, commerce adviser to Pakistan’s prime minister. Dawood predicted that figure would expand to $26 billion in the next fiscal year, surpassing the nation’s total exports last year, he said.




Abdul Razak Dawood Interview
Abdul Razak DawoodPhotographer: Asad Zaidi/Bloomberg





The textiles industry -- which supplies everything from denim jeans to towels for buyers in the U.S. and Europe -- is one of the country’s few economic bright spots. Textiles amount to about 60% of Pakistan’s total exports and the nation allowed its factories to open ahead of India and Bangladesh when the pandemic first emerged in 2020, drawing orders from global brands including Target Corp. and Hanesbrands Inc.

“A lot of orders actually were shifted from Bangladesh and India to Pakistan” during the pandemic, said Dawood in an interview at his Islamabad office. “The other good thing that’s happening is we are now becoming competitive with Bangladesh. Three, four years ago, Bangladesh was really beating us.”

Taking Off
Pakistan's textile exports forecast to reach all-time high for two years


Source: Commerce adviser estimate, Pakistan Bureau of Statistics




Read more: Opening Early Helped Pakistan Boost Exports During Pandemic

The government also plans to announce a proposal next month that will likely provide incentives for exports to new markets such as Africa, South America and Central Asia, Dawood said. The nation is doubling down to boost textile exports through measures including tax breaks, cheap loans and supplying electricity at rates that are comparable with rivals in South Asia. A 60% decline in the local currency against the dollar since 2018 has also helped.

“Pakistan’s exports have become competitive over the past few years,” said Ahfaz Mustafa, chief executive officer at Ismail Iqbal Securities Pvt. “There is a fixed energy tariff regime that keeps in mind regional prices, the government is much quicker to refund the money it owes exporters and there has been a giant currency devaluation.”

‘Under Pressure’
The South Asian nation is looking to increase its exports to get out of its regular boom-bust economic cycles that have led it to seek an International Monetary Fund program 13 times since the late 1980s. It’s also trying to revive a $6 billion bailout program to meet financing requirements amid a record trade deficit.

Pakistan’s commerce adviser said there is “very little” that can be done about the nation’s record-high imports, which are driven mainly by purchases of petroleum products such as gasoline, gas and vaccines that are essentials. Pakistan will be “under pressure” if oil hits $100 a barrel, Dawood said. He does expect food-related imports to decline this year following a better domestic crop harvest.

The nation’s also pushing to intensify trade with Central Asia nations by signing agreements and allowing free movement of trucks. Trade has already grown to $120 million in six months of the current fiscal year from $14 million in the entire preceding year, he said.

Yes, Pakistan could have a niche market in the Oriental carpet industry.

Oriental carpets in the West are considered to be a luxury good.

Only if Pakistani businessmen can capitalize on this opportunity.

 

[KaiserX]

Pakistan is one of the largest agricultural/dairy/food producers in the world. This govt had to take tough decisions that previous govts avoided making.

Pakistani industry is far more competitive and well placed today since the Musharaf regime came to power. Industrialist and IT industry are ready to thrive much further.

In the last 5 years, IT exports have increased 50% annually, textile exports have doubled, pak avoided any contraction in economic growth, and the rebound is causing a surge in inflation.

Good decisions have been made in implementing tarrifs on luxury items or electronic goods/automobiles. This needs to be further increased. A lot of room for improvement still needs to be made.

The elite sector needs to be made to suffer for a few years for the good of the country, that means taking away their subsidies, forcing them to pay taxes, and making sure no one gets away with theft of public funds ever.

Modeling our public sector along the lines of the Chinese would be far better for Pakistani society. In many ways the only system that kept China together and gave it rise could do the same for Pakistan. I am not saying communist but some form of national model where policies are put in place for next 50 years and implemented without any changes in the political scene.

 

[Pak Nationalist]

Global energy situation uncertainty coupled with the IMF programme.

Give or take few months it will be implemented.

Hope so, waiting for 2-3 years already.

 

[Zibago]

our cotton industry moved to BD when zardari era failed to provide power when pakistan have 15 hours power cut . now as we are power surplus things are getting better day by day . how stupid people are whom still wanna vote those most useless parties .

Its not only about energy we also had violence in Karachi

 

[RIP Pak LAW]

I am also expecting surge of exports to Afghanistan in coming months provided they can pay you back.

 

[SD 10]

Pakistan is one of the largest agricultural/dairy/food producers in the world. This govt had to take tough decisions that previous govts avoided making.

Pakistani industry is far more competitive and well placed today since the Musharaf regime came to power. Industrialist and IT industry are ready to thrive much further.

In the last 5 years, IT exports have increased 50% annually, textile exports have doubled, pak avoided any contraction in economic growth, and the rebound is causing a surge in inflation.

Good decisions have been made in implementing tarrifs on luxury items or electronic goods/automobiles. This needs to be further increased. A lot of room for improvement still needs to be made.

The elite sector needs to be made to suffer for a few years for the good of the country, that means taking away their subsidies, forcing them to pay taxes, and making sure no one gets away with theft of public funds ever.

Modeling our public sector along the lines of the Chinese would be far better for Pakistani society. In many ways the only system that kept China together and gave it rise could do the same for Pakistan. I am not saying communist but some form of national model where policies are put in place for next 50 years and implemented without any changes in the political scene.

for that you need to sit all parties down and formulate a charter of economy that everyone follows......

 

[Warking]

Music to my ears! My dad's name is still literally etched into a concrete pillar as the foundations of the family textile mill was being laid in Karachi, with '1951' added to his name by him as a teenager. The mill is doing really well. In fact, my brother has his own side smaller textile factory which is doing well now after he moved it from a location where power outages were common to a place where power, though expensive, is at least reliable.
Pakistan lost a lot because of electricity shortages some years ago.

What equipment dose Pakistani textile factories use? I am curious if we use up to date methods and equipment or not.

 

[S.Y.A]

Its not only about energy we also had violence in Karachi

and yet, during that violence, toyota, suzuki plants were still working, banks were still operational, IT companies were doing well, and so were pharma companies/factories. textile industry is one of the worst in terms of reliability. old machinery, old sethiya mindset, and an extreme aversion to adversity and competition.