Monday, June 21, 2021

Textile exports decline by 3.1 percent in February

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Textile and clothing exports decreased in February from a year ago owing to a decline in value-added exports declared the official data released by the Pakistan Bureau of Statistics (PBS) on Tuesday. The export value of these sectors dropped down to $1.23 billion in February from $1.27bn over the corresponding month of last year, showing a decline of 3.12 per cent.

The government had been informed of the drop in exports of value-added sectors and was urged allow duty-free import of cotton yarn to bridge the shortfall in domestic production. Experts believe that a further drop is expected in the coming months if the government fails to allow duty free import of cotton yarn into the country.

According to the Pakistan Bureau of Statistics (PBS), in February, exports of knitwear and bedwear fell 13 percent and 1.2 percent year-on-year. The decline was carried out from 10.3 and 7.3 percent contraction month-on-month

11.6 percent decline in volumetric sales is likely to blame for the decrease in exports, said Topline Research. “In last six years, February textile exports have fallen in range of 1-10 percent – except for February 2020,” the brokerage commented. This 6.7 percent decline in dollar terms and 7.3 percent decline in rupees term in exports can be attributed to the lower number of working days in February.

Other than that, cotton yarn increased 40 percent month-on-month to $120 million because of the 35 percent rise in quantity that was exported. According to the PBS data, the export of cotton yarn showed an increase of 23.16pc in February from a year ago. The export of yarn other than cotton yarn also recorded a growth of 27pc during the month under review.

In the non-value-added sectors, the export of art and silk declined 8.09pc, made-up articles excluding towels, bedwear 2.75pc and other textile products 0.36pc during the month under review.

Read More: Cotton: Handling the White Gold Crisis of Pakistan

The overall exports in January decreased by 3.20pc to $2.068bn in February 2021 compared to $2.136bn over the corresponding month last year.

In the eight months of this fiscal year, there was 1.73pc increase in the import of textile machinery which shows that the industry is aiming to modernize and expand its operations.

According to the Pakistan Bureau of Statistics, Pakistan has imported around 688,305 metric tonnes of cotton and yarn while there is a minimum shortfall of six million bales. A gap of about 3.5 million bales is present that the government would need to fill through imports.

Due to the rising decline in cotton production, users were forced to import from United States, Brazil and Uzbekistan.

Read More: 2020, a critical year for cotton crop, says Minister

Pakistan Apparel Forum Chairman Jawed Bilwani on Monday said that unavailability of cotton yarn and sudden decrease in the value of rupee against the US dollar can harm efforts made by the value-added garment and home textile segments. The fluctuations in the rupee-dollar parity and cotton yarn not being available has resulted in the textile sector being fearful of losing orders. Due to this, the exporters belonging to the garment and home textile sectors fear a steep decline in exports in the coming months, he added.

Federation of Pakistan Chamber of Commerce and Industry (FPCCI) former president Mian Anjum Nisar said that If the country loses textile orders, it will be a huge setback for Pakistan as the government is currently aiming to increase exports and narrow the import bill.

Commerce Adviser Razak Dawood has said that the textile policy would be finalized as soon as a decision on subsidy on gas and electricity for the sector is made.

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