Textile sector YoY exports decline 0.12 percent in October

KARACHI: Exports of textile and clothing products declined 0.12 percent year-on-year to $1.13 billion in October 2018, while on month-on-month basis, textile sector exports grew 10.34 percent compared with $1.024

billion recorded in September 2018, the Pakistan Bureau of Statistics (PBS) reported on Friday.

Taimor Asif at Pearl Securities said the government officially notified uniform gas rate for five major export industries, including textile while reportedly relief was also planned on electricity rates.

“Furthermore, the depreciated rupee, which is currently trading around Rs133 to a US dollar, will make the Pakistan textile industry competitive globally and provide due support to the textile industry in achieving higher growth in the coming months,” he added.

For the first four months of the current fiscal year (July-October), textile sector exports surged a miniscule 0.41 percent to $4.407 billion as against exports of $4.389 billion in the same period last year.

In October, cotton yarn exports decreased 34.84 percent year-on-year to $79.04 million; knitwear exports rose 16.13 percent to $261.54 million; bed wear exports declined 0.37 percent to $187.38 million; readymade garments exports surged 7.62 percent to $210.887 million, while cotton cloth

fetched $184.21 million in October, down

1.21 percent over the same month a year earlier.

Acting president, Karachi Chamber of Commerce and Industry (KCCI), Khurram Shahzad said Pakistan’s exports were largely dependent on imported inputs. “Fluctuation in rupee value and costlier utilities have rendered Pakistan’s products uncompetitive in the international markets.”

Shahzad said the government did not have a long-term policy to encourage the country’s exports and support the local manufacturers.

“We hope the government would undertake some concrete and sustainable reforms for the export sector, as without increasing the exports, the country would not be able to achieve sustainable economic growth,” he added.

Furthermore, the perennial issues plaguing the sector remained largely unaddressed. Lack of availability of system gas and costlier RLNG have forced several smaller mills to close operations, another negative for textile exports for the year.

Finally, analysts believe that while spinners would be able to pass on at least some of the additional cost burden due to demand for yarn in the local markets, it would be more difficult for value-added goods’ manufacturers to increase prices in their predominant export markets.