Pakistan's textile exports, a crucial contributor to foreign exchange earnings, saw a sharp decline of 8% month-on-month and 7% year-on-year, totaling $1.3 billion in November 2023. The primary cause attributed to this slump is the recent surge in gas prices, escalating production costs and diminishing the competitiveness of Pakistani textile products globally.
The textile sector, classified into basic and value-added textiles, witnessed mixed performances. Basic textiles observed a 14% MoM decrease but a 20% YoY increase, bolstered by a significant surge in raw cotton exports. Conversely, value-added textile exports recorded a 6% MoM and 12% YoY dip, with towels being the worst-hit segment.
In the first five months of fiscal year 2023-24, textile exports amounted to $6.9 billion, marking a 6% YoY decline. The government's ambitious target of $25 billion for the fiscal year appears challenging, with the research firm predicting exports to reach $17 billion due to higher energy prices and currency pressure.
Additionally, the Sindh High Court has intervened, putting on hold the Sui Southern Gas Company's recent gas tariff hike, responding to a plea from the textile sector. The All Pakistan Textile Mills Association (APTMA) has urged the government to reduce power tariffs to regional averages, expressing deep concern over the sector's performance and warning of potential economic repercussions.
