pk textile industry

8/7/2019 pk textile industry

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the largest and mostimportant sub-sector ofthe economy.

T he textile and apparelindustry is considered asthe backbone of theIslamic Republic ofPakistans economy.

The most importantindustrial sub-sectorin Pakistan.

Based on locallyavailable raw cotton.


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Textile products are a basichuman requirement next onlyto food.

It provides largest

employment to industrial

labor force.

Pakistan ranks fourth amongworld cotton producers

Pakistan ranks third amongworld cotton consumers


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Pakistan is the 6th

largest importer of rawcotton

Pakistan is the 1stlargest exporter ofcotton yard

Over 1.3 million

farmers, out of total of5 million are involvedin cultivation of thiscrop


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44thth largest grower of cottonlargest grower of cottonafter USA, China and Indiaafter USA, China and India

33rdrd largest consumer oflargest consumer ofcottoncotton

33rdrd largest exporter oflargest exporter ofcotton textilescotton textiles

22ndnd largest supplier oflargest supplier ofcotton yarn with 26% sharecotton yarn with 26% shareof the international marketof the international market

IntroductionIntroduction


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Textile share of overallmanufacturing activity is46%

export earning is 68% 63% of the total exports

of Pakistan comprisetextile products

Provide employment of38%.

The contribution of thisindustry to total GDP is8.5%


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Taken as a wholebetween 30 and 40%

of the cotton ends upas domesticconsumption of finalproducts .

The remaining isexported as raw

cotton, yarn, cloth andgarments.


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largest source of jobopportunities andaccounts for 33.23percent of the total

industrial labour force. It contributes 17.35

percent to the total valueaddition in large scalemanufacturing.

It is also a major sourceof revenue

Its value of fixed assetsaccounts for 18.49percent of the totalindustrial assets.


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TEXTILE INDUSTRY'S ECONOMIC CONTRIBUTIONTEXTILE INDUSTRY'S ECONOMIC CONTRIBUTION

ExportsExports62.1% OF TOTAL EXPORTS62.1% OF TOTAL EXPORTS

(US $ 10.211 BILLION)(US $ 10.211 BILLION)

ManufacturingManufacturing 46% OF TOTAL MANUFACTURING46% OF TOTAL MANUFACTURING

EmploymentEmployment 38% OF TOTAL LABOUR FORCE38% OF TOTAL LABOUR FORCE

GDPGDP 8.5% OF TOTAL GDP8.5% OF TOTAL GDP


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The Pakistani textileindustry depends ondomestic agriculture tosupply its raw materials

the success of the cottoncrop is critical to thehealth of the textile

industry. Cotton accounts for 14

percent of land undercultivation in Pakistan.


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The textile industry ofPakistan has a

spinning capacity of 1550million kgs of yarn

weaving capacity of 4368million square metres offabric

finishing capacity of 4000million square metres.

The industry has a production

capacity of 670 million unitsof garments, 400 million units of knitwear 53 million kgs of towels.

.


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CottonCotton

YarnYarn

Grey fabricGrey fabric

Bleached fabricBleached fabric

Dyed fabricDyed fabric

Printed fabricPrinted fabric

Knitted fabricKnitted fabric Bed linenBed linen

Home textilesHome textiles

Made upsMade ups

TowelsTowels

Industrial UniformsIndustrial Uniforms

SportswearSportswear

Baby wearBaby wear

FoundationFoundation

GarmentsGarments Woven apparelWoven apparel

KnitwearKnitwear

AccessoriesAccessories

Textile and Clothing rangeTextile and Clothing range


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The micronaire range ofThe micronaire range ofPakistan cotton is 3.8 toPakistan cotton is 3.8 to4.9 NCL which is prime4.9 NCL which is primemicronaire rangemicronaire range

Pakistan cotton is bestPakistan cotton is bestsuited for spinning of 20 tosuited for spinning of 20 to40 counts40 counts

It has good absorption i.e.It has good absorption i.e.90,000 PSI and above90,000 PSI and above

It has good uniformityIt has good uniformity

Pakistani cotton staple isPakistani cotton staple isbetween 2.38 c.m to 3.15 cmbetween 2.38 c.m to 3.15 cm

12 million bales per annum12 million bales per annum

New varieties introducedNew varieties introduced

every yearevery year Excellent absorptionExcellent absorption

capacitycapacity

Good dyeing and printingGood dyeing and printing

capabilitiescapabilities

Suitable for all kinds ofSuitable for all kinds ofcotton blendscotton blends

Cotton QualityCotton Quality


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Traditional producers ofTraditional producers ofyarn for domesticyarn for domesticconsumption and exportsconsumption and exports

Large spinning sectorLarge spinning sector

High investments in stateHigh investments in stateof the art machinery andof the art machinery andtechnologytechnology

Strong base for expansionStrong base for expansionin valuein value--addedadded sectorssectors

Cotton YarnCotton Yarn


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Range of light toRange of light toheavy fabricsheavy fabrics

All kinds of blendingAll kinds of blendingdone with importeddone with importedyarnsyarns

Used for home textilesUsed for home textiles

and all kinds ofand all kinds ofapparelapparel

Total export US$Total export US$1.345 Billion1.345 Billion

Cotton FabricCotton Fabric


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Vertically integrated units mean that there is fullVertically integrated units mean that there is fullcontrol on the production of the entire valuecontrol on the production of the entire value

chain, from fibre to garmentchain, from fibre to garment The buyers are assured of consistent qualityThe buyers are assured of consistent quality

Short lead times and quick deliveriesShort lead times and quick deliveries

Versatility in product rangeVersatility in product range Flexibility in designingFlexibility in designing

InIn--house embroidery and accessorieshouse embroidery and accessories

TechnologyTechnology


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Cotton and yarn arePakistan's primarytextile exports.

The textile industryaccounts for over 60percent of Pakistan'stotal exports.

Textile sector is highly

protected sector and itsdemand and supplydepends on the globaleconomy.


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Previously exportcountries for textileindustries were USA,

Hongkong, Germany,China, South Korea,Switzerland, Russia andFrance.

recentlyTurkey, Portugaland Singapore are added

in the list. Major imports are done

by European countriesthrough quota system.


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During First 8 months(July-Feb, 2010), textileindustry import ofmachinery increased by

1.3% i.e. form $158.897million to $ 463.844million.

Besides machinery, textilesector also importspetroleum, plastic, iron,steel etc.

Import cost for textilesector has also risen by$7.992 million to 23.10million.


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Pakistan must competewith other producerssimilar in conditions and

comparative advantage. The PakistaniTextile

industry's biggestcompetitors are China,India, Indonesia and

Turkey. The cost of power in

Pakistan iscomparatively high.


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The AllTextile MillsAssociation (APTMA)listed 455 companies in

textile sector Nishat Mills Limited(NML) is the majorplayer in terms ofcapacity as well asmarket capitalization

(0.6% of the KSE AllShare Index)

Gul AhmedTextile Mills(GATM) in terms ofexports.


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Total investment intextile sector from past

10years (1999-2009)was $ 7.5 million


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All PakistanTextileMills Association is the

chief organization thatdetermines the rulesand regulations in thePakistan textile

industry.


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premier national tradeassociation of the textilespinning, weaving, andcomposite millsrepresenting theorganized sector inPakistan.

APTMA emerges as thelargest association of the

country as it represents396 textile mills out ofwhich 315 are spinning,44 weaving and 37composite units.


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To encourage friendly feeling andunanimity amongstTextile Mill owners onall subjects connected with their commongood.

To promote and protect the tradecommerce and manufactures of Pakistan in

general and of the cotton trade inparticular To collect and circulate statistics &

information classify relating to the trade,commerce and manufactures of itsmembers.

To take all steps which may be necessaryfor promoting, supporting or opposinglegislative and other measures affectingthe trade and commerce

To make representation to local, Provincialand Central authorities on any matterconnected with the trade, commerce andmanufactures of its members.

To advance and promote commercial andtechnical education connected with thetrade and commerce of its members.

To undertake special inquiries and initiateor support any.

To take any action which may be conducive

to the extension of the trade and commerceof its members or incidental to theattainment of this object.


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Its Principal Office is located atKarachi and Regional Offices areat Karachi, Lahore andPeshawar.

The Principal Office functionsunder the administrative controlof the Chairman and CentralExecutive Committee.

principal office deals with theaffairs connected with textiletrade and industry effectingmembers relating to FederalGovernment,

matters concerning ProvincialGovernments are dealt by theRegional Offices under thedirection of Regional Chairmen.


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The world demand fortextiles is rising ataround 2.5%, due towhich there is agreater opportunity forrise in exports from

Pakistan.


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To overcome global competition, the Pakistanigovernment in 2006 approved a Technology-basedIndustrial vision and strategy for socio-economic

which called for technology up-gradation, humanresource development, and establishment of a fullyintegrated chemical industry in the country.

Investment Policy & Incentives forVision 2005-2010: Whole of textile sector is included in list of value

added industries. 5% custom duty on imported machinery if not

manufactured locally. Tax relief: Initial Depreciation allowance (IDA) at 50%

of machinery & equipment cost.


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2006-07 (July-June)was the best year forPakistans textile and

clothing industry whenthe industry managedto export US$ 10.8billion with the support

of friendly governmentpolicies, internationalenvironment, andlower cotton prices.


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Government claims to diversifythe export base by focusing onthe sectors other than thetraditional ones,

According to textile exporters

No new product or new markethas significantly contributed tothe exports and it is the sameold and traditional items thathave been making the totalexport volume

Electricity crisis also declinedGDP rate.

The power problem, gasshortage, high financing costand infrastructure problemsdisturbed badly the growth ofthe value-added textile sector.


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The share of textile exports intotal exports of the countryshrunk to 55 percent so far inthe current financial year

from well above 60 percent inthe past years. overall export volume

remained stagnant in the firstseven months of the currentfinancial year,

During July-January 2009-10,total exports came to $10.870billion as against $10.820billion in the correspondingperiod of last year.


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Pakistan's textile and clothing exportsfell in the first eight months of thecurrent fiscal year, due to surging rawmaterial prices, energy crisis, Cottonyarn

primary export earning category wentdown by 15%, woven readymadegarments by 12%, bed wear by 10%, knitwear garments by 3% during the period.

exports of cotton cloth andTowels wentup by 6% and 10% respectively cession.

the textile industry in the country ispassing through a very critical periodwith number of closers and shutdowns.

On the domestic front, Interest rate hasgone up by 20%, during the last sixmonths and inflation in the country hasreached 21%.


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HIGH COMPETITION: Pakistan iscurrently placed at 8th position inthe world. Its major big competitorsare China, India and Bangladesh,

which are providing cheap and highquality textile products than

Pakistan.

Pakistan is surviving Just because ofquota system (USA and EU).

Pakistan is producing below its

capacity.


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POWER PROBLEMS: Major lossto textile sector is due to textilesector. Due to power shortage,textile industry is unable toproduce its demanded products.

PAK RUPEE USD PARITY: As

PKR depreciates, it is aprofitable situation for textileindustry in terms of exports andif PKR appreciates, it is a losssituation for textile industry.Reverse is the case with textileimports.

COSTOF PRODUCTION: AsChina has cheap labor, whichautomatically decreases cost ofproduction.


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there is a need for theindustry to improve thequality of its products.

There is also the need for

greater value addition in itsproducts. Need of efficient R&D and

training. tough competition from the

Indian, Bangladeshi andChinese textile industries.

The cost of power in Pakistanis high as compared to that inother countries.


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The Government has to ensure:

Stable market environment. Adequate finance for investments and for labor

force. Cutting down of taxes. Rationalization of the existing policies and

development of a long term policy environment.


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The industry has to:

Redevelop competitiveness

by improving productivity

reduce wastages and thus

lower cost of production.

Develop marketing strength

by adopting aggressive

marketing strategies. To overcome energy crises

problem, textile industries

should build its own powerplants.


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Switch market alsotowards SOUTH EASTASIAN NATION i.e.Malaysia ,Japan ,Korea,Singapore.

Export end-productrather than rawmaterial.

Launch some new

brands in order toincrease our exports. Need of skilled man

power and cheap labor


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To privatize Public SectorPower Units so that theseentities could be managedefficiently.

The gas tariffs for textilesunits should be freeze atthe current level for atleast next 3-5 years.

The import of electricity isan option even forshort/medium term, tomeet the high growthrates of demand in thecountry.

The government shouldannounce the financialpackages for the textileindustry so that the

modern technology beimported to lessen the costof production

Thermal efficiency ofWAPDA and other PublicSector Units be enhanced

Coal based powergeneration to be exploredon a priority basis, utilizingthe abundant availability ofcoal reserves.

pk textile industry

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