Pakistan textile, clothing exports to US not growing at desired pace

Karachi: United States is one largest market for Pakistan’s textile and clothing products. US market is currently going through turbulent times due to financial crisis, retail figures indicate steady sales in 2011. US import figures for 2011 are not yet released, Pakistan’s textile and apparel exports are expected to increase by 3% in terms of value but quantities are expected to go down by 18% in 2011, signifying growth primarily due to price inflation in raw materials cost, says Pakistan Readymade Garments Manufacturers & Exporters Association PRGMEA.

Apparel exports to US are 49% of its total textile exports. While products are well diversified, Pakistan’s exports to US seem to be overly reliant on cotton as principle raw material. 94% of Pakistan’s total textile exports are cotton based. In contrast products made from non-cotton based raw materials such as wool comprise only 2% of exports to US, man-made fibber based constitute 4% and silk & vegetable fibber based products comprise only 0.1%.

During 2010, apparel exports to US increased by 14% year-on-year in value and 9% in terms of quantities, and non-apparel exports rose by 9% in value and 5% in quantity. For year 2011, Pakistan’s apparel exports to US are expected to increase by 6% in value and non-apparel likely by 1%. In terms of quantity, apparel exports will decline by 15% and non-apparel quantities expected to decline by 19%.

Cotton based products are expected to increase by 2% in value and quantity go down by 21%. Major export products to US, such as men’s/ boys knit shirts, cotton hosiery, men’s/ boys cotton trousers expected to increase; substantial gains expected in man-made fibber products. Although their quantum value is very small, just $126 million in 2010, around 38% increase is expected in 2011.

PRGMEA says Pakistan’s textile and garment exports to US are clearly not growing at desired pace, at least in major categories. Regional competitors are steadily increasing their share in US import market. Growth in man-made fibber products is commendable but as quantum is very small, it will have no visible effect on overall exports.

In order to stem this decline, textile and garment exporters need to further diversify their exports to more value added products, preferably in non-cotton products. Pakistan also needs to step-up its trade diplomacy to do away with unfair tariff regime. A Free Trade Agreement (FTA with US would be highly beneficial.

Leave a Reply