TEXTILE INDUSTRY

A LEADING INDUSTRY
GROUP MEMBERS
 RABI AFTAB
 AFSHAN NASEEM
 SYEDA TOOBA
 SANA TARIQ
 SHAHEER MALIK
 AGENDA
 ABOUT TEXTILE  PRODUCTION TREND
 DEVELOPMENT OF  MAIN MARKETS
INDUSTRIES
 IMPORT
 IMPORTANCE
 TEXTILE IN BRIEF
 EXPORTS
 MARKET SHARE  SWOT ANALYSIS
 ECONOMIC PROFILE  EFFECTS OF WTO
 TEXTILE SECTOR PROFILE  PROBLEMS
 ISSUES CONCERNING
UNITS
ABOUT TEXTILE
 A textile is a cloth, which
is either woven by hand
or machine.
 "Textile" has traditionally

meant, "a woven fabric".

 The term comes from the

Latin word ‘texere’,

meaning ‘to weave’.
HISORICAL
BACKGROUND
 At the time of independence Only 6 Textile Units
with:
 80,000 spindles
 3000 looms,
 Supply 8% of the domestic demand
 The Government set the objective of promoting
Textile Industry first as an import substitution
industry and later as an export oriented industry.
 Rapid growth during 50’s & 60’s.
 With the sudden upsurge textile spinning and
composite units started picking up roots
 During the nineties a combination of
factors adversely effected the industry,
mainly:
 Removal of export duty on raw cotton, increasing domestic
prices to international levels and beyond.
 Infestation of the cotton crop by leaf curl virus, reducing
supply sharply and increasing prices.
 Frequent changes in governments creating inconsistency in
policies of the Government and Financial Institutions.
 Rapid expansion of the installed industry in the hands of new
entrants who did not have the managerial skills or the liquidity
base to succeed.
 Rapidly changing global markets, especially the shift towards
man made fibers.
 IMPORTANCE
 The textile and clothing industry is the
backbone of Pakistan's economy
 Single largest determinant of the growth in
manufacturing sector
 Pakistan is a monocrop economy as cotton
contribute 10% in the agriculture GDP
 4th largest Producer of Cotton
 3rd largest Exporter of raw cotton
 A leading Exporter of yarn in the World
IMPORTANCE (CONT)
 Cotton is the cash crop of Pakistan.
 Availability of cheap labor and basic raw cotton
 The exports of textile and textile products of
Pakistan have shown a significant increase in
the recent years.
 Global textile and clothing trade is set at $ 356
Billions in 2000 with textiles trade at $ 157
billions and clothing trade at $ 199 billions
(W.T.O report).
 Pakistan has a strong presence in International
Textile Market with share of $.4.53 billions
export in textiles and $.2.144 billions exports in
clothing (2000).
Textile Vision 2005
 An open, market driven, innovation
& dynamic textile sector, which is:-
 Internationally Integrated.

 Globally competitive.

 Fully equipped to exploit the

opportunities created by the Multi

Fiber.
 ECONOMIC PROFILE
 Cotton textile is the largest industry of Pakistan.
 It is a broad industry and involves spinning yarn
production weaving and cloth production.
 Completely regulated to allow expansion by the
private sector.
 Important sector of economy as its product form
almost 60% of Pakistan total exports and 18% weight
in the country’s large scale industrial production.
Contribution to total exports 68% (US $ 5.2 billion)

Contribution to manufacturing 46% of total manufacturing

Contribution to value addition 27% of industrial value addition

Contribution to GDP 10.5% of total GDP

Sector Employment 38% of total employment (15 million)

Skilled & Un skilled Ratio 70 : 30

Market Capitalization 12% of total market capitalization

Salaries and Wages 44 billion per annum

Total sector Investment   31% of total investment ( Rs.140 billion)

Technology Medium

Sources of Machinery Japan, Germany, Switzerland, Belgium, China

 Numbers of Units &
::.
Capacities
Total Capacities:
Spinning 1550 million Kgs Yarn

Weaving 4368 million Sq. Mtr.

Fabric
Finishing 4000 million Sq. Mtr.
Garments 670 million Pcs.
Knitwear 400 million Pcs.
Towels 53 million Kgs.
Number of units:
Ginning 1221
Spinning 442
Weaving :
Large 124
Small 425
Power Looms 20600
Finishing :
Large 10
Small 625
Garments :
Large 50
Small 2500
Knitwear 600
Towels 400
 Sub-Sector No of Size (Installed Production
Units Capacity)
1.  Ginning 1221 5,488 Saws 10.314 M Bales

2.  Spinning 456 a)    9.6 million spindles 1.818  M. Kgs Yarn

b)    146,640  Rotors

3.  Weaving 50 20,000 – 25,000 Shuttle-less looms 5,600 M. Sq MT (Approx)

Composite Units 140 225,000 Conventional Looms

Independent Mills    

Power Loom Sector    

4.    Finishing    - 2,700 M. Sq. MT

       Organized Sector 106

 Small Scale Sector 625

5.  Garment Units 5,000 450,000 Sewing Machines 650 M Pcs.

6.  Terry Towels 400 7,600 Looms    55   M. Kgs.

7.  Canvas 100 2,000 Looms 35 M. Kgs.

8.  Knitwear 700 21,000 Knitting Machines      5.50 M. PCs.

Source: TCO, APTMA, PHMA, PRGMEA
 Global Scenario
 This scenario provides an opportunity to
Pakistan to excel in the sector and its
share could reach to the level of 4 per
cent to 5 per cent.
 Textile market stands today is worth
more than $400 billion and it is still
growing every year
 The share of developing countries in
world textile exports improved from 15
to 50 per cent
 A variety of fabrics are used worldwide
in different applications such as apparel,
household textiles and furnishings,
medical equipment, industrial and
technical products
Global Scenario
 Global textile trade in the world is
estimated to be around $300 billion
currently and industry experts predict
that by 2014 it would reach to $800
billion.
 Pakistan's share in the current trade
volume is 2.7 per cent. India has 4 per
cent and China 26 per cent share.
 Asia's share in the world textile trade
would increase from the current level of
54 per cent to about 75 per cent by 2014.
 Pakistan’s Textile Industry Opposite
Regional Players
Pakistan China India
• Textile exports at • Textile exports at • Textile exports at
USD 10.8bn USD 144bn
USD 15.2bn
• Perceived as a low • Ability to offer full
range products in the
• Continuous
quality product
manufacturer of textile value chain
development
semi-finished goods • Largest purchaser of adding to the
Hardly any
• textile machinery in product portfolio
investment in the the world
of the country
downstream over • Skill development for
the last 5 years all products in the • Various textile
textile value chain institutes to focus
• No investment in
product on the entire
• Continuous focus on textile value
development product development
chain
• Lack of skill – • Runs
Finishing processes • Continuous focus
MAIN MARKETS
 USA
 EU
 MIDDLE EAST
 SAUDI ARABIA
 HONK KONG
 RUSSIAN REPUBLIC
Country wise measure market
share of textile of exporting
countries
COUNTRIES MARKET SHARE
CHINA $55 BILLION

INDIA $- BILLION

KOREA $35 BILLION

TAIWAN $16 BILLION

INDONESIA $9 BILLION
Percent Share of Leading
Cotton Producers
 PRODUCTION TREND
 COTTON AREA UNDER CULTIVATION, PRODUCTION
AND YIELD
Year Area Hectare million bales Kgs/Hec
Production
Yield
1999-00 2983 11.24 641

2000-01 2927 10.732 623

2001-02 3116 10.613 579

2002-3(pro) 2796 10.211(9.7) 621

 Textile in Brief
GDP 10.5 % of total GDP

Exports 68% of total exports

Manufacturing 46 % of total manufacturing

Employment 38 % of total industrial workers

Investment 31 % of total investment

Taxes Rs. 101 billion per annum

Value Addition (In Aggregate) 27%

Technology Medium to High

Source of Machinery Japan, Germany, Switzerland,

Belgium, China
 Textile Share in Pakistan’s Exports
VALUE IN '000' US$

S.N CATEGORIES 1999- 2000- 2001- 2002-03 2003-04 2004-05

O 2000 2001 2002

A TEXTILE & GARMENTS 5,858,861 6,115,070 5,996,910 7,457,748 8,252,403 9,030,000

B OTHER CORE CATEGORIES 1,878,643 2,134,186 2,079,826 2,252,498 2,410,729 3,086,000

C DEVELOPMENTAL  CATEGORIES 479,642 566,218 615,917 851,597 832,147 867,000

D ALL OTHERS 351,453 386,121 441,915 598,403 818,006 1,427,000

TOTAL 8,568,599 9,201,595 9,134,568 11,160,246 12,313,285 14,410,000

Source: Export Promotion Bureau

 Textile Share in Pakistan’s Exports
VALUE IN '000' US$
S.NO CATEGORIES 1999- 2000- 2001- 2002-03 2003-04 2004-05
2000 2001 2002

A TEXTILE & GARMENTS 5,858,86 6,115,07 5,996,91 7,457,74 8,252,403 9,030,00

1 0 0 8 0

B OTHER CORE 1,878,64 2,134,18 2,079,82 2,252,49 2,410,729 3,086,00

CATEGORIES 3 6 6 8 0

C DEVELOPMENTAL 479,642 566,218 615,917 851,597 832,147 867,000

CATEGORIES

D ALL OTHERS 351,453 386,121 441,915 598,403 818,006 1,427,00

0

TOTAL 8,568,59 9,201,59 9,134,56 11,160,2 12,313,28 14,410,0

9 5 8 46 5 00

Source: Export Promotion Bureau

 Top Imports into Pakistan
000 US $
S.No. ITEMS 1999-2000 2000-2001 2001-2002 2002-03 2003-04 2004-05

1 Crude Petroleum 805 1,360 1,230 1,366 1,765 2,090

2 Petroleum Products 1,999 2,000 1,576 1,699 1,402 1,723

3 Road Motor Vehicles 345 320 329 501 653 972

4 Textile Machinery 210 370 406 531 598 902

-2.04% -3.45% -3.92% -4.34% -3.80% -4.40%

5 Iron And Steel 304 277 336 402 512 894

 Textile & Garments
Machinery Imports into
Pakistan
Key indicators at a Glance               amt.
(000USD)

Items 2002-2003 2000-2001 2002-2003

  TOTAL    12,220,000   10,339,547  
10,309,425

Textile 525,000 406,908 210,952

Share(%)    4.30 %    3.94 %    2.05 %

GRAPH PRESENTATION
STRENGHTS &
OPPORTUNITIES
 Pakistan is the 4th largest producer of Cotton in the
World.
 It ranks 2nd in export of yarn & 3rd in export of cloth.
 It has Large spinning and weaving capacity
 Large, well equipped finishing sector
 Availability of cheap labour
 Large domestic market.
 Good and clear investment policies.
 Strengths &
Opportunities
 Strong presence in international market.
 Volumes of yarns with synthetic fibres in various blends &
counts are increasing.
 Production of commodity products at good quality levels
 Market Franchise Technical know how Agreements
 Joint Venture in Higher Value Added Segments.
 Product & market diversification.
 Improvement in marketing skills and country’s image.
WEAKNESSES
 Outdated technology
 Poor quality

 Low productivity

 High proportion of operations are in

small and medium sized companies

 Tend to be inefficient and lack the

resources to effect an improvement

Effects of WTO
 Abolition of textile quota is likely to have a
negative impact unless the domestic pricing
system is reformed.
 Quota abolition will create opportunities, but will
increase competition in the international
markets.
 Pakistan should focus on increasing productivity
 The clothing sector will have greater
opportunities
 Only 10% of the local exporters are mentally
prepared to meet the WTO challenges (Chairman
Export Promotion Bureau (EPB) Tariq Ikram).
Problems
 WTO and quotas
 Sales tax on cotton
 DTRE (Duty and Tax Remission for
Exports)
 Lack of Infrastructure
 Lack of synergy
 Inefficient industry
 Trade remedy actions
 Cotton
 ISSUES CONCERNING
UNITS
 OUTDATED MACHINERY
 LACK OF RESEARCH AND DEVELOPMENT.
 THE TOTAL PRODUCTION OF COTTON DECREASED
AFTER 2004- 2005, 14.4 MILLION BALES
 THE AREA OF COTTON CULTIVATION REMAINS TO 3.25
MILLION HECTARES FOR THE LAST SOME YEARS.
 THE LACK OF SUPPORT OF THE GOVT OF PAKISTAN
 INCREASE IN PRICES OF PETROLEUM HAS ESCALATED
THE COSTS OF TEXTILE EXPORTS
ISSUES CONCERNING UNITS
(Cont.)

 INDUSTRIALISTS FEAR TO EXPAND DUE TO UNCERTAIN ECONOMICAL

SITUATION AND BEEN WAITING FOR A NEW AND BETTER DEVELOPMENT
OF POLICIES.
 ALSO, THERE IS A SERIOUS SHORTAGE OF RAW MATERIAL IN THE
LOCAL MARKET FOR FUTURE EXPORT ORDERS.
 INCREASING TARIFFS OF UTILITIES WILL ALSO GIVE RISE TO TEXTILE
GARMENT PRODUCTION COST BY 10%, AS A RESULT THE INERNATIONAL
BUYERS WILL TURN TOWARDS OTHER COUNTRIES.
 ISSUES CONCERNING
UNITS (Cont.)
 BECAUSE OF THE SUBSEQUENT LOW PROFITABILITY IN
COTTON CROPS, FARMERS ARE SHIFTING TO OTHER OTHER
CASH CROPS, SUCH AS SUGAR CANE.
 ANOTHER MAJOR PROBLEM FACED IS THE LACK OF
INFRASTRUCTURE.
 EXPORTERS ARE LOOSING BUYERS IN THE WORLD MARKET
FO R NOT MEETING THE EXPORT SHIPMENT TARGETS DUE TO
INCREASING COST OF PRODUCTION.
THE
END...!!