TEXTILE

INDUSTRY OF
PAKISTAN

About
Textile
Textile is a term that comes from
texere which is a Latin word, that
means to weave.
A cloth, especially one manufactured
by weaving or knitting; a fabric.

Introductio
n

The textile industry is often

considered the backbone of the
Islamic Republic of Pakistans
economy.
Pakistans textile Industry is the
fourth Largest Cotton Producer.
6th largest importer of raw cotton
The Third largest Consumer

INTRODUCTION
The textile industry contributes
approximately 46 percent to the total
output or 8.5 percent of the country GDP.

In Asia, Pakistan is the 8th largest

exporter of textile products providing
employment to 38 percent of the
work force in the country.

Value chain of textile

industry
RAW
MATERIAL
TEXTILE
PLANTS
SPINING
WEAVING
DYING
PRINTING

APPAREL
PLANTS

DISTRIB.
CENTRES

RETAIL
STORES

ACCESSORIES
CUSTOMERS

OVERVIEW
Pakistans textile industry ranks amongst
the top in the world. Cotton based textiles
contribute over 60% to the total exports,
accounts for 46% of the total
manufacturing and provide employment
to 38% manufacturing labor force. The
availability of cheap labor and basic raw
cotton as raw material for textile industry
has played the principal role in the growth
of the Cotton Textile Industry inPakistan.

HISTORY OF TEXTILE IND.

1950
s

Pakistan's industrialization
began in the 1950s with the
textile industry at its center

PIDC came into being which had

the main objective of
industrializing the country in
major fields
The modern development of the
sector started in 1953 with the
inauguration of the Valika textile
Mill at Karachi.

HISTORY OF TEXTILE IND.

1960
s

By mid sixties there were

about 180 units of textiles
bleaching, printing and
processing units, mostly
situated in Karachi and Punjab.

New private investment began

with a highly protected home
market

Newly established mills were based

upon imported technology but there
was a lack of technical staff and
shortages of capital.

HISTORY OF TEXTILE IND.

1970
s

By 1970-71 there was 113

textile units and the industry
had 2,605 thousand spindles
and 30 thousand looms
After the separation of East
Pakistan Cotton Export
Corporation of Pakistan was
established which meant that
most of the private sector work
was taken over by the state.
The textile industry suffered
heavy losses because the export
of cotton was controlled by the
CEC

HISTORY OF TEXTILE IND.

1980
s

The eighties brought a relief to

the textile industry due to the
boom in international market
and industry friendly policies
of the government.

There was a rapid growth in

spinning sector.

Till 1980-81 spinning continued

to expand.

HISTORY OF TEXTILE IND.

1990
s

The number of units rose to

440 in 1996-97

World demand for good quality,

wide width fabrics grew and
replacement and a
modernization process started.
Machinery for producing
garments and made-ups was also
freed from import duty. As a
result, a huge expansion in the
spinning sector took place in the
first five years of the 1990s.

HISTORY OF TEXTILE IND.

1999
to
2008

Textile exports in 1999 were

$5.2 billion and rose to
become $10.5 billion by 2007.

Textile exports managed to

increase at a very decent
growth of 16% in 2006.
Textile exports share in total
export of Pakistan has declined
from 67% in 1997 to 55% in
2008, as exports of other textile
sectors grew

HISTORY OF TEXTILE IND.

2009

The textile industry employs

almost 40 percent (2008-09) of
the industrial workforce
textile industry is being hit hard
due to ongoing energy crisis,
depriving the gas supply to the
textile units for three days a
week.
Pakistans cotton cultivation has
declined due to several factors
ranging from cultivation of traditional
varieties and via traditional methods,
poor marketing, and failure in
making timely payments to cotton
producers.

HISTORY OF TEXTILE IND.

2010

(APTMA) had prepared a based report

for the federal government in which it
has been projected that the textile
industry exports would cross over $16
billion compared to its present level of
around $8 billion.

Significant changes to the

general sales tax (GST) on
industrial sector including
textiles

HISTORY OF TEXTILE IND.

2011

Textile exports stood at $12.5

billion from July 2010 to May
2011

Energy crisis leaves Pakistan

textiles in tatters

HISTORY OF TEXTILE IND.

2012

Pakistans $13.8 billion textile

industry is struggling to
survive a critical shortage of
energy to run its plants.
10percent of the spinning mills
and fabric printing units have
shut down, and half of the
remaining plants are struggling
to survive
thousands of textile workers
poured out onto the streets of
the city, burned tires, and
shouted slogans against the
government.

HISTORY OF TEXTILE IND.

2013

Textile millers, workers in

gas protest

PERFORMANCE CHART

IMPORTANCE OF TEXTILE INDUSTRY

IN ECONOMIC SECTOR
Pakistans economy relies heavily on
its cotton and textile sectors.
The cotton-processing and textile
industries make up almost half of the
countrys manufacturing base, while
cotton is Pakistans principal
industrial crop, supplying critical
income to rural households.
Altogether, the cotton-textile sectors
account for 11 percent ofGDPand

TEXTILE SECTORS CONTRIBUTION TO THE ECONOMY OF

PAKISTAN

According to the economic survey of

Pakistan 2008-09 the Pakistan textile
industry contributes more than 60% to the
country total exports, which amounts to
around 5.2 billion US dollars.
According to the 2012 Economic Survey of
Pakistan, issued by the finance ministry,
the textile industry itself constituted about
4% of the total size of the economy.

TOP BUYERS OF PAKISTANI TEXTILE

GOODS ARE

USA, EU, Gulf region, UK, Hong Kong,

Japan, Korea, Saudi Arabia, Italy,
Turkey, Germany, Norway, France,
Canada, Sweden, Australia, etc.

IMPORTANCE OF TEXTILE
SECTOR
In asia pakistan is the 8 largest exporter of
textile products
Cotton is the basic Cash crop of Pakistan.
Textile products are one of the essential and
basic human requirement next to food.
Pakistan is the 3rd largest exporter of raw
cotton

IMPORTANCE OF TEXTILE
SECTOR
Cheap labor and Raw cotton are available.
It provides employment to 38% of the work
force in the country which amounts to a
figure of 15 million. However, the proportion
of skilled labour is very less as compared to
that of uskilled labour
2nd Largest supplier of cotton yarn with 26%
share of the international market.

FORWARD AND BACKWARD LINKAGE

BACKWARD
LINKAGE

The backward
linkage of
textile sector is
in agricultural
sector.

FORWARD
LINKAGE

The forward
linkage includes
finished goods
and like knitted
and readymade
garments

SECTORS OF TEXTILE
INDUSTRY

Spinning
Weaving
Processing
Printing
Garment manufacturing
Filamen yarn manufacturing

FACTORS OF PRODUCTION
Cotton is an economic asset of
Pakistan, it is a natural fiber used
primarily as a raw material in textile
industry.
The World cotton production is
estimated at 118.8 million bales in
2007-2008.

COTTON
Leading produces of cotton include
USA, China, India, Pakistan,
Uzbekistan and turkey.
Both Punjab and Sindh are the major
cotton growing provinces, where as
N.W.F.P is not known for growing
cotton production.

FIBER
Cotton was primarily used as a raw
material in yarn manufacturing but the
growing demand for blended yarn and
fabrics has shifted the raw material source
towards the manmade or synthetic fiber in
Pakistan.
Pakistan usage is currently at 74% cotton
and 26% manmade fiber, whereas the
world fiber mix is 45% cotton and 55%
non-made fiber.

SPINNING
Spinning is the process of converting fibers
into yarn.
The fibers maybe natural fibers such as
cotton or man made fibers such as
polyester.
Sometimes , the terms spinning is also
used for production of manmade yarn (that
is not made for fibers).
What so ever is the case the final product
of spinning is yarn.

SPINNING CONSIST OF

Blowing and mixing

Carding
Combining
Drawing
Simplex
Ring Spinning
Cone Winding

WEAVING
weaving sector is one of the most
important textile sub sector.
The exports of woolen fabrics and
other related woolen made-ups from
a major portion of textile exports
from Pakistan.
Weaving is a process which turns
yarns into cloth.
The machine used for weaving is the
loom

Weaving comprises on :
Wrapping
Sizing
Weaving

COTTON GINNING SECTOR

Leading producers of cotton include USA, china, India,
Pakistan, Uzbekistan and turkey. The current market
share of cotton in 56 percent in all fibers. Textile fibers
are divided into three basic types according to their
sources such as cotton fiber, man made fiber and wool.
There are 1221 ginning factories in the country.

Ginning industry has installed capacity of more than

one million bales on a single shift basis and total
capacity of around 20million bales on three shift bases.

COTTON SPINNING SECTOR

Pakistan has the third largest spinning capacity
in Asia with a spinning capacity of 5% of the
total world and 7.6% of the capacity in Asia.
Pakistan growth rate in this sector has been
6.2% per annum.
At present, cotton-spinning sector is comprised
of 421 textile units (50 composite units and
471 spinning units) with 10.1 million spindles
and 114 thousand rotors in operation with
capacity utilization of 89 percent and 60
percent respectively, during July-Mar 2007-08

WEAVING & MADE-UP SECTOR

There are three different sub-sectors in weaving
i.e, Integrated, independent Weaving Units, and
Power Loom Units.
This sector is producing comparatively low
value added Grey Cloth of mostly inferior
quality.
However, the performance of cloth sector
remained far better than last year and charted a
growth of 12.6 % during July March 2007-08 .

Textile Value Chain Process

Cotton value chain starts from Ginning that adds
value to it by separating cotton from seed and
impurities.
But Spinning can rightlybe called as the first
process ofthe chain that adds value to cotton by
converting into a new product i.e. conversion from
ginned cotton into cotton yarn.
Since spinning is in the beginning of value chain,
so all the later value added processes of weaving,
knitting, processing, garments and made-ups
manufacturingare dependent upon it.

Textile Value Chain

Process
If spinning industry produces sub-standard yarn, its
effect goes right across the entire value chain.

The spinning sector forms the heart of the textile

industry. This sector produces yarn for downstream
sectors, namely weaving, processing and knitting.

Pakistan is the third largest player in Asia with a

spinning capacity of 5% of the total world and
7.6% of the capacity in Asia.
Pakistans growth rate has been 6.2% per annum
and is second only to Iran amongst the major
players.

TEXTILE NEWS
Textile industry of Pakistan worst
hit by power cuts
The energy crisis has forced the
textile mills to close their units,
especially in Punjab the industry is
under severe pressure. Chairman
APTMA Punjab, Shahzad Ali Khan, said
daily electricity load shedding has
increased to 12 hours.

 The Pakistan textile industry

contributes more than 60 percent (US $
9.6 billion) to the
countrys total exports. However,
currently this industry is facing great
decline in its
growth rate. The major reasons for this
decline can be the global recession,
internal security
concerns, the high cost of production due
to increase in the energy costs etc.

A spokesman for the All Pakistan

Textile Mills
Association (APTMA) claimed that 60 to
70 per cent of the industry had been
affected
and was unable to accept export orders
coming in from around the globe, as a
result of gas load shedding

PROBLEMS FACED BY TEXTILE

INDUSTRY
Lack Of Research And Development
In Cotton Sector
Lack of Modernize equipment
Finance bill to burden industry
further
Increasing cost of production
Internal issues Pose a Larger Threat
for Pakistans Textile Industry
Effect of infaltion

PROBLEMS FACED BY TEXTILE

INDUSTRY

Energy crisis
Electricity crisis
Gas shortage
Tight monetory policy
Removal of subsidy on textile sector
Lack of new investment
Raw material prices
Export performance of textile sector

SPECIAL ORGANIZATION
All Pakistan Textile Mills Association
(APTMA) is the chief organization that
determines the rules and regulations in the
Pakistan textile industry.
APTMA is the premier national trade
association of the textile spinning, weaving
and composite mills.
APTMA represents 391 textile mills out of
which 309 are spinning, 45 weaving and
37 composite units

HUMAN RESOURCE
The textile sector employs 45% of overall labor
force, with 38% of the manufacturing Workers
employed under textile sector.
Pakistan has the advantage of cheaper labor as
compared to its competitors, but unfortunately
the labor productivity is very low.
There are hardly any training programs to
develop the skills of labor hence, the craftsmen
entirely depend upon thier inherited skills with
no advancement and movement towards
technical knowledge.

CLIMATIC CONDITION
Although Pakistan has the ideal climatic
conditions for the growth of cotton providing a
factor advantage to the textile industry, but it
is also quite vulnerable to pesticides that can
lower the yield per hector.
The textile sector is largely dependent on the
supply of raw material of the agricultural sector
and
hence
whatever
happens
to
the
agricultural sector like floods will adversely
affect the textile industry rendering it even
more vulnerable to environmental conditions.

TRAINING
Limited availibility of trained technical staff to maintain
and run machinery at full efficiency is a constraint upon
the development of Pakistans textile industry.
This shortfall is partly due to a lack of technical
education facilities.
Some of the developments in the textile industry
include: Advances in ring spinning, computerized dyeing
and finishing, computer-aided designing , manufacturing
and developming retailing links hence, all these demand
new and greater skills and Pakistan lacks it.

EDUCATION
Education is essential for the development of the
textile industry. Even if the basic factors are present,
unless value-addition is not done on them, they will
not be productive enough.
Even if there is not enough production a country
could still manage through research and
development.
A recent survey shows technical manpower
requirement is 12,750 graduates whereas total
number of technical personnel available up tp 2003
was approx. 7,950, so there is a shortage of 4,800
graduates in textile science.

Textile Industry Pros And

Cons
ADVANTAGE

Pakistan has the

advantage of
cheap labor as
compared to its
competitors, but
unfortunately
the labor
productivity is
very low

There are
DISADVANTAGE
hardly any
training
programs to
develop on the
skills of these
labors and the
craftsmen
depend upon
their inherited
skills with no
advancement

STRENGHTS
Self reliance
Manufacturing flexibility
Abundance of raw material production
32
Design expertise
Availability of cheap labour
Growing economy and domestic market
Progressive reforms

WEAKNESSES
Research & Development (R&D)
Developed countries are using the technology of
biotechnology and genetic engineering to
increase the quality and quantity of their cotton
production. In Pakistan, there is very some
research done on small scale by private
companies. Practically no efforts are being made
by the APTMA in the R&D of the textile industry to
enhance the quality of its products.

WEAKNESSES

Highly fragmented sector

High dependence on cotton
Lower productivity
Declining mill segment
Technological obsolescence
Nonparticipants in trade agreements

WEAKNESSES
Poor quality standards.
Pakistans textile industry should
focus on latest material handling
techniques and should train workers.
The inability to timely modernize the
equipment, machinery and labor has
led to the decline of Pakistani textile
competitiveness

THREATS
New competitors
Pakistan is facing new competitors in textile sector such
as Bangladesh, Vietnam and Turkey. Though we cannot
avoid competition but we can always stay ahead of them
by reforming our strategies and educating our
entrepreneurs so as to move one step forward in every
aspect.
Phasing out of quota system
As the quota system is ruled out by WTO, there is a
threat by the Chinese and Indian manufacturers to gain
most of the market share. We have high costs, low labor
productivity and inefficient production processes.

THREATS
3. Fashion life cycle
Fashion changes day by day these days. Media has so
much penetrated in our daily lives that we easily adapt
ourselves as it wants us to. This has resulted in shortening
the fashion lifecycle thus increasing the fashion risk.
Now the buyer does not want to wait long for his
consignment because he is insecure that by the time it
will reach to him he will lost its demand due to change in
fashion. Therefore, they prefer to buy from neighboring
countries even at higher cost to get their products
instantly rather than to wait weeks or months for their
consignments to reach them.

 Stiff competition from developing

countries; especially China and India.
Pricing pressure
Locational disadvantage
International labour and
environmental laws

ENVIROMENTAL ISSUES
Textile industry is associated with
some environmental issues some of
them are:
Large volumes of water.
Usage of complex chemicals.
Discharge of untreated effluent
Water Pollution.
Air Pollution.
Labours concern.

RECOMMENDATIONS
Remedy Though Foreign Direct Investment (FDI)
Image Building Of Pakistan To Attract Foreign
Direct Investment (FDI)
Focus On Value Addition
Technology Up-gradation & Capacity Building
Human Resources Development
Subsidy Removal Should Be Taken A Back
Interest Rate Should Be Low Down In Order To
Survive This Industry
Electricity & Gas Tariff

RECOMMENDATIONS
Removal of Energy Crisis
Exploration of new Export Markets
Reducing the cost of doing Business in
Pakistan
Need for Improving Textile Production
Improvement in productivity
Awareness of International Quality Standards
Introducing concept of on-the- job-training
Introducing efficient management techniques

CONCLUSION
Textile industry is the backbone of the Pakistans
economy. The textile industry of Pakistan plays an
important role in earning foreign exchange,
providing employment to the country. Pakistans
textile industry is going through one of the toughest
periods in decades. Our textile sector needs to
capitalize on the new emerging opportunities by
adhering to global
best practices, adapting rapidly changing
technologies, better supply chain management
while
trying to reach global value chains.