Pakistan’s textile sector loses $1bn export orders

Claiming that over 300 textile mills have been closed due to a cut in gas supply, All Pakistan Textile Mills Association (Aptma) Chairman Abdul Rahim Nasir on Wednesday urged the federal government to restore gas supply to the textile industry on an urgent basis, stressing that a loss of almost $1 billion in exports has already been incurred because of it.

Accompanied by Aptma North Zone Chief Hamid Zaman and Senior Vice-Chairman Kamran Arshad at a press conference, he said the 26 per cent upsurge in the export of textiles during fiscal year 2021-22 was made possible only due to the supply of energy at a regionally competitive tariff, reports dawn.com.

He stated that the textile industry performed admirably, increasing textile exports from $12.5bn in 2020 to nearly $20bn in 2022, a 60pc increase.

He claimed that the exponential growth in the textile sector has promoted investment of over $5bn and the establishment of 100 new textile units, which, after becoming operational, would result in fetching additional exports of $6.0bn per annum.

Mr Nasir pointed out that gas supply to the industry was suspended for a week, almost halting production in the whole value-added industry and causing a colossal loss to the economy.

He added that the large-scale closure of mills has resulted in massive layoffs and unemployment, spreading economic chaos.

He believes it is inexplicable that the exporting sector, which has pledged to increase textile exports to $25bn by 2022-23, is being denied energy and gas. He said that an incessant supply of gas was imperative for the industry to maintain momentum in exports.

Mr Zaman said that the textile sector has repeatedly delivered on its commitment to enhance exports and proven that they are a viable and long-term solution provider for the economic stability of the country.

He warned that more than 50pc of output would be lost this month, with a very high risk of permanent order loss and buyer diversion from Pakistan to its competitors.

He stated that the textile industry is currently producing goods for the upcoming Christmas, and any delay in the delivery schedule risks losing export markets for an indefinite period with little chance of recovery.

“If this momentum is lost due to energy supply and cost constraints, Pakistan will be forced to seek an additional $6bn in loans from abroad, which under the circumstances may not even be possible,” he said, stressing the immediate restoration of gas supply to the export-oriented industry.

Highlighting the importance of the textile sector in the mainstay of the country’s economy, Mr Arshad said that textiles have a 61pc share in the country’s exports and 40pc of manufacturing sector employment. The fragile economy of the country cannot sustain the consequences of the closure of mills in the wake of non-supply of gas.