Textile Industry of Pakistan at Cross Roads
Dr. Muhammad Mushtaq Mangat1
Many views about the contribution of Pakistan Textile Industry (PTI) for the
economy of Pakistan have been presented so far. Most of these views are based on
the facts provided by the government and the textile industry. More than 60% national
exports are textile products. It is one of those industries, which provides employment
opportunities to a large labor force in Pakistan. According to a recent report of
APTMA, Pakistan Textile Industry contributes 8.5% to the total GDP and employs
40% of industrial workforce.
Pakistan Textile Industry caters to all sorts of textile and clothing demands of
Pakistan. Moreover, it is also exporting goods of worth more than US $ 14 billion.
Since the total international market size is more than US $ 800 billion, it also shows
that the share of Pakistan Textile Industry in international trade is only 1.75%.
Pakistan Textile Industry is one of the biggest industries of Pakistan. Government of
Pakistan supports this sector, which is obvious from the rebate on exports given in
1990. Government of Pakistan announced many incentives for this sector. In spite of
all such supports, role of this sector on international scenario is not considerable. This
fact is obvious from the comparison of textile and clothing exports of Pakistan with
neighboring countries (Table 1).
Table 1 shows the clothing export trend from 1981-2010. It is obvious that there was
a big opportunity in the last 20 years. The share of China rose significantly because
statistics show that China only had 4.19% share in the international clothing market
and in 2010, its share increased to 36.94%. If we include market share of Hong Kong
in the market share of China, the total share of China is 42.7%, which is close to half
of the total international clothing exports.
Woven garments are noted as readymade garments in reports by TDAP
Second remarkable change has been observed in the share of Bangladesh and Turkey.
Bangladesh had negligible share in 1981 (0.013%), which rose to 3.2% in 2010.
Turkey had 0.8% share in 1981 and in 2010, it became 4.5%.
On the other hand, we can observe decline in clothing exports of developed countries.
For example, Italy had 10.899% share in 1981 while it became 6.68% in 2010. In
1981, France had a share of 4.89% and in 2010, it became 3.08%. However, we can
observe that despite severe competition from developing countries, developed
countries still have a significant share in clothing exports.
There is no significant change in the performance of Pakistan and India in clothing
exports. Pakistan had 0.346 % share in 1981 and it was only 1.12% in 2010. India had
1.923% share in 1981 and it was 3.631% in 2010. Still, the growth rate of the textile
sector of India is higher than Pakistan.
Table 1 depicts that among developing countries, Bangladesh is one of those
countries, which has the highest growth rate. The progress of Bangladesh is linked
with the easy availability of workers in large numbers for clothing manufacturing. It
is supported by the fact that major exported items are basic products, which need
more labor and less technological and capital input. Following table provides a
comparison of textile and clothing exports of South Asian countries. Importing
countries have given a special status to Bangladesh of most poor nation, which
increased sympathies and helped in boosting its exports.
Table 1 Clothing Export from 1981-2010
Country 1981 1989 1997 2010
World 39,261 100 93,324 100 185,779 100 351,464 100
China 1930 4.92 8165 8.75 31803 17.12 129,838 36.942 32.03
5424 13.82 13994 15.00 23108 12.44 24,049 6.843 -6.97
Italy 4279 10.90 9441 10.12 15017 8.08 19,977 5.68 -5.21
Germany 2501 6.37 5632 6.04 7508 4.04 16,978 4.83 -1.54
Turkey 314 0.80 2741 2.94 6697 3.61 15,660 4.46 3.66
India 755 1.92 2060 2.21 4343 2.34 12,760 3.63 1.71
Bangladesh 5 0.01 440 0.47 2688 1.45 11,246 3.20 3.19
France 1920 4.89 3626 3.89 5316 2.86 10,839 3.08 -1.81
Viet Nam 5 0.01 0.00 1384 0.75 9,954 2.83 2.82
Spain 274 0.70 478 0.51 1353 0.73 7,145 2.03 1.34
Indonesia 95 0.24 1146 1.23 2904 1.56 6,820 1.94 1.7
1707 4.35 2362 2.53 5180 2.79 5,472 1.56 -2.79
United States 1305 3.32 2211 2.37 8672 4.67 4,694 1.34 -1.99
Mexico 5 0.01 0.00 5636 3.03 4,363 1.24 1.23
Thailand 344 0.88 2458 2.63 3686 1.98 4,300 1.22 0.35
Pakistan 136 0.35 722 0.77 1810 0.97 3,930 1.12 0.77
Malaysia 160 0.41 1070 1.15 2337 1.26 3,880 1.10 0.7
Tunisia 327 0.83 776 0.83 1504 0.81 3,043 0.87 0.03
Philippines 578 1.47 1452 1.56 2319 1.25 1,764 0.50 -0.97
Greece 386 0.98 1474 1.58 1953 1.05 1,045 0.30 -0.69
Taipei, Chinese 2851 7.26 4735 5.07 3404 1.83 963 0.27 -6.99
Moreover, it is obvious that during the last 20 years, many developed countries
succeeded in maintaining their position and the most prominent among them are Italy
and France. Although, we can observe a decline but still, their share is more than
developing countries including Bangladesh, India and Pakistan etc. These developed
countries do not have cheap labor. High exports of developed countries show that
these countries are exporting high value products manufactured by using latest
Two examples mentioned above show that both models can be adapted to achieve
high targets of growth either producing cheap products by using cheap labor like
Bangladesh or producing high value products in lesser quantities like Italy, France
Pakistan at cross roads
Where Pakistan stands? This question needs to be answered. Can we follow
Bangladesh model or model of developed countries? Bangladesh gained this position
by developing less capital but through its labor-intensive and labor-abundant industry
whereas developed countries adopted modern technology and capital-intensive
industry for producing hi-tech products. By doing so, they succeeded in maintaining
their share to some extent.
The dynamics of both the models are quite diverse because both of these models
require different resources and planning. This report is an effort to provide a real
picture of the resources required for the above-mentioned production techniques.
It is essential to review our current exports. Table 2 shows that textile and clothing
sector has 55.06 % share in the total exports of Pakistan. Interestingly, share of raw
goods, which are used as raw materials for clothing manufacturing and other finished
goods is significant. Share of such items is 21.1% in total exports. Export share of
clothing (knitted and woven garments2
) is only 16.4%. These products can be
considered as most value added items in the whole list. Value of bed ware and towels
is 11.49 %, which are considered as least value added products among clothing
This discussion shows that around 50% textile and clothing exports of Pakistan are
mainly raw materials. Average unit price of woven garments is US $4.27 and the
price of knitted garments per unit is only US $ 1.47 as published by Trade
Development Authority of Pakistan. These low prices show that producing woven
garments can be more profitable than selling raw materials.
Unit prices mentioned above show that Pakistan is exporting clothing for cheaper and
competitive international markets. Because of competition in these markets, Pakistani
companies are exporting clothes for thin margin. In these markets, success depends
upon low cost of production, which is possible only when a producer produces in
Woven garments are noted as readymade garments in reports by TDAP
Bangladesh made a significant progress due to bulk production. Developed countries
maintained their share in international market by adopting latest technology and
producing high tech finished products. Moreover, developed countries have initiated
technical textile and functional clothing. Such products are quite costly and provide
an edge to manufacturers of developed countries over the manufacturers of
Table 2 Textile and Clothing Exports from Pakistan
Commodity Value Million
Share in Total
Grand Total 24,810 100
Total Textile Commodities 13,661 55.06
Cotton Fabrics 2,623 10.57
Cotton Yarn 2,201 8.87
Yarn Other than Cotton Yarn 48 0.19
Raw Cotton 365 1.47
Ready Made Garments 1,774 7.15
Towels 762 3.07
Textile Made-up (Excl.B.Ware & Towels) 625 2.52
Synthetic Textiles 608 2.45
Carpets & Rugs 132 0.53
Knitted/Croached Fabrics 81 0.33
Tents & Canvas 47 0.19
Knitwear (Hosiery) 2,306 9.29
Bed Ware 2,089 8.42
Where Pakistan stands and what model it should follow?
Deciding the textile production model is an issue, which needs to be addressed. Many
people believe that Pakistan should enter in value added market. Some people think
that Pakistan is unable to cater to the demands of world's specialized market.
This paper is an effort to describe the dynamics and requirements of both models
mentioned above. Considering these facts, Pakistan can decide to opt for the most
suitable and appropriate manufacturing strategy.
Value added production and its Dynamics
Production of high value products is not easy because it needs specialized market
knowledge, specific knowledge of varieties of raw material, production techniques,
high investment, specialized and educated labor force, and market research. There are
basic four requirements for value added products:
1. Market for such products
2. Specialist human resources for production
3. High tech production facilities
4. Testing equipments for quality assurance, research, and development.
In the following lines, we will review the availability of such facilities in Pakistan.
Needs of specialized market
We can divide this market into two main segments:
1. Fashion and design clothing
2. Functional clothing or technical textile
As reported by Technical Textile Net3
, China has announced double incentive scheme
for technical textile exporters. It shows the future plan of China. China is shifting
from commodity to functional textile. It is further reported that USA has launched a
25 years project for the manufacturing of military clothing. Technical Textile Net
estimated US $ 140 billion as the net worth of technical textile market in 2010.
Average estimated growth rate is more than 3.5%.
Synthetic fiber is a major raw material for technical textiles. Pakistan is among those
countries, which are using more than 60% cotton for the production of textile and
clothing products. Share of synthetic fibers is less than 40%. In addition to that, many
technical textile products are produced on non-woven machines. These machines are
rare in Pakistan. Pakistan needs to import machines and raw materials for the
manufacturing of technical textiles. Cost of labor is very low in Pakistan as compared
to the capital and raw material costs. It is a capital-intensive industry and does not
required large labor force. Keeping all above in view, we need to assure the
availability of synthetic fibers and machinery for manufacturing technical textiles.
Textile Education in Pakistan
Second important factor is lack of technical people, who are capable of handling the
end-to-end process of technical textiles. In Pakistan, universities provide technical
education, which does not fully cope with the requirements of practical
manufacturing. University graduates are unable to handle sophisticated manufacturing
machinery and they are even unable to maintain the manufacturing machinery. Most
of Pakistani universities provide basic training and students have to invest years for
on-the-job trainings for gaining technical expertise.
There are textile departments in the following universities:
1. National Textile University4
2. Mehran University of Engineering and Technology Sindh
3. Baluchistan University of Information Technology, Engineering and
Management Sciences Quota
4. Bahauddin Zakariya University, Multan, Pakistan
5. NED University Karachi
6. Synthetic Fibre Development & Application Centre Karachi
7. University of Management and Technology Lahore
8. University of Faisalabad
9. Hajveri University Lahore
In all these universities, a few universities are offering postgraduate courses in textile
engineering. Most of these courses are undergraduate courses. It is obvious that the
purpose of under graduate courses is to produce engineers for the floor, who are only
It was founded only for textile engineering but now more than 50% of its students
are studying management courses.
capable of supervising the production flow. No intensive research activities are
conducted at undergraduate or graduate level. Only MS courses are partially research
oriented. A student has to study 16 years in order to get admission in MS courses and
after that he or she gets introduced to the research process.
The above mentioned universities are serving the nation very well and since the last
many decades, they are fulfilling the industry demands. But for the production of
technical textiles, their graduates do not have knowledge, expertise and experience.
To enter in technical textiles production, we should introduce such courses in our
universities. Without such effort, it would be difficult to get any reasonable share in
the international market of technical textiles.
Research and Development Institutes
It is a hard-to-accept fact that there is no specialized textile research and development
institute in Pakistan for conducting researches on nation's major industry. There is just
one cotton research institute in Pakistan. It is mainly serving agriculture for better
cotton crop. It has nothing to do with the textile industry.
There is no possibility to enter the high technology market without any plan. It is the
responsibility of the government to facilitate industry. R&D activities are high-cost
activities and the private sector cannot afford it.
Keeping this fact in view, we should not expect the industry to produce high-tech
products. There is no lab in Pakistan for testing thermal parameters of textile
products. Pakistan only has basic textile quality testing facilities.
There are numerous R&D institutes in India and Sri Lanka while Pakistan lags behind
because of lack of R&D facilities. Keeping these facts in view, there is practically no
possibility of the production of technical textiles and high value products in Pakistan
in the near future.
Technology level and textile industry
Pakistani textile industry relies on import of high tech machines in all fields including
ginning, spinning, weaving, wet processing and stitching. From the following data; a
person can observe the trend of machinery imports. The useful life of most of
machines and equipment used in textile manufacturing is not more than 5 years. After
five years, a manufacturer should replace the old technology with new one for more
efficiency and productivity.
Following two tables depict that against exports of worth more than US $10 billion
annually, imports of Pakistan's textile industry had been only US $514 million
annually during the last ten years.
More than one third imports had been in spinning sector. The role of spinning sector
in value addition is quite limited. The main value addition is in the wet processing and
Table 3 Import of Textile Machinery in Pakistan
(US $ Million)
Source: Pakistan Bureau of Statistics
Table 4 Textile Machinery Imports (Sector wise)
Sector 2008-09 2009-10 2010-11 (P)
Amount Share % Amount Share % Amount Share %
Spinning 88.4 41.70 101.3 34.06 159.6 34.98
Weaving 46.4 21.89 70.4 23.67 109.5 24.00
Knitting 32.8 15.47 56.9 19.13 86.7 19.00
Finishing 36 16.98 60.6 20.38 91.2 19.99
Others 8.4 3.96 8.2 2.76 9.2 2.02
Total 212 100.00 297.4 100.00 456.2 100.00
Source: Pakistan Bureau of Statistics
Conclusion & Recommendations
Pakistan is at crossroads. There is a need to develop a long-term plan for improving
textile manufacturing and research facilities. Such plan should be comprehensive and
based on facts because Pakistan can initiate manufacturing high value products. This
needs latest technology including production machines and testing equipments. It
also requires human resources with up-to-date knowledge. It is not possible without a
huge investment and long term planning. It may take more than 10-20 years to initiate
producing textile products for high tech clothing market.
Second option is to follow China, Bangladesh, India and Sri Lanka. In this case,
Pakistan has to rely on our cheap labor and producing goods for cheaper markets. In
these markets, competition is more and profits are thin. In current scenario, when
government is failing to provide finance and energy at competitive rates, following
this labor intensive technique has less possibility for implementation.
Pakistani industrialists have the capability to compete in the international market if
they get un-interrupted power supply at consistently low rates. They also require
financial support for upgrading obsolete machinery and improving their cash flow.
It is strongly recommended that the government should assure the un-interrupted
supply of power, finance manufacturing units on low interest rates and address the
nation's security issue. In the meantime, Pakistan should make a comprehensive plan
to produce for technical textiles market within next 10-20 years by the support of
academia and industry.
The best possible plan is a mix of strategies. Initially, Pakistan should begin
improving its textile sector through producing a low cost labor-intensive initiative. It
should produce products for cheaper markets and this will increase Pakistan's total
share. It has double-pronged advantage --- labor will be employed and closing
industries will be able to survive. As soon as Pakistan successfully increases its share
in the international textile exports by 1%, it should encourage its textile sector to
purchase low cost machinery from China and Korea. This stage will be a take-off
stage because it is semi-capital intensive stage where some specialization of labor will
be needed and production processes will be better than the first stage. After this stage,
Pakistan should improve relations with African, European, and Central Asian
countries and start exporting to those countries. It will not only open new markets for
Pakistani textiles but their demands will instigate the textile manufacturers to move
towards further automation. The third stage will be a final stage because in that stage,
Pakistan can move towards total automation and producing high-tech products. On
that stage, Pakistan can achieve its objectives through two ways: inviting international
producers to come and operate in Pakistan and also inviting the producers of high tech
machinery to come and operate inside Pakistan. But for all these stages, Pakistan
should provide security, cheaper credit, and good governance. The government needs
to provide funds to initiate textile research facilities in order to make Pakistan a major
textile exporter within the next 10-20 years.