Despite the challenges, Pakistan's textile exports still grow by 26.5%

by:JIYALI     2021-08-15
Pakistan’s textile industry has been condemned for abuse of research and development funds. Iqbal Ebrahim, president of the All Pakistan Textile Mills Association (APTMA), responded to this. He said that although the textile industry is facing the dilemma of weakened competitiveness, exports have still increased by 26.5%.  Mr Ebrahim said that Pakistan’s textile exports increased from US$8.564 billion to US$10.757 billion in 2006-07, an increase of 25.6% from 2004-05.   From July to March 2004-05, exports were 5.972 billion U.S. dollars. The corresponding time in 2007-08, exports were 7.766 billion U.S. dollars, an increase of 1.794 billion U.S. dollars, or 30%.   He said in a statement that the textile industry is facing multiple difficulties, such as large-scale power outages and cessation of natural gas supply. These factors have caused unprecedented damage to the country’s textile production. At the same time, the rising cost factors have led to the continuous weakening of Pakistan’s export competitiveness. Due to the national law u0026 order situation, foreign buyers are unwilling to enter Pakistan. They are willing to go to safer countries and regions. This increases the cost burden of Pakistani exporters. They must go to other countries to meet with buyers and customers. At the same time, This also affects the development of products and designs.   In rebutting the accusations of corruption, Mr Ebrahim said that the Ru0026D support cost of the textile industry has increased from 25% to 30% in the past three years.   In the first nine months of this fiscal year, textile exports fell by 3.14% compared to the same period in the previous fiscal year. There are many reasons behind it, such as increased business costs. In order to meet the needs of the textile industry, approximately 25% of the raw material (cotton) was imported.   In addition, some textile products are stuck in the United States and other countries because of the slowdown in local economic development. He said that since January 2005, the EU has cancelled the zero-tariff concessions for Pakistani products. Therefore, Pakistan’s exports have regressed. Because of the rising business costs, we are rapidly reducing the market share we have worked hard in exchange for.   In addition, the tax rebate rate has dropped sharply, and interest has started to increase because the Ru0026D support provided to exporters has reduced costs. If no support is provided, the export may suffer irreparable losses.  According to the president, Pakistan’s textile industry has invested approximately US$6 billion in the past six years. The interest rate is 3-4% lower than the prevailing interest rate during the investment period, and is currently around 13-16%.   He said that the export loan interest rate was increased from 3% to 9%, and then dropped to 7.5%. However, due to the modification of the financing arrangement made by the National Bank of Pakistan, the bank was unwilling to provide loans at this interest rate. Some news media said that the textile industry is the biggest beneficiary of subsidized loans. In the first nine months of the current fiscal year, the textile industry has received US$2.6 billion in export financing. Mr Ebrahim responded to this. He said that during the same period, textile exports It is 7.766 billion US dollars, which is about 2.7 times the export financing quota. Therefore, it should be said that the government has drastically reduced the financing ratio from 70% to 50%. In view of the above reasons, regarding Pakistan’s exports, especially the competitiveness of textiles in the international market, the President of APTMA made a request: The government should continue to provide Ru0026D support to the textile industry, solve the problems faced by the textile industry, earn more foreign exchange, and at the same time expand Our share of the world textile export market.
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