A letter written by the All Pakistan Textile Manufacturers Association (APTAMA) to the State Bank of Pakistan has warned that failure to restore the financial refinancing facility in the face of the dollar crisis will lead to the destruction of the textile industry. While the government is aware of the situation in the current worst economic crisis and wants to sign a debt recovery agreement with the IMF without delay to get the economy out of trouble, APTMA concerns are also genuine. Pakistan’s textile sector, once the backbone of the country’s economy, is facing a severe crisis that has been ongoing for several years. The industry, which accounts for more than 60% of Pakistan’s total exports, has been struggling to maintain its competitiveness in the global market, primarily due to rising costs, lack of technological advancement, and inadequate government support.
The textile sector crisis in Pakistan is not new, and it has been persistent for several years. Despite being a significant contributor to the economy, the industry is facing a multitude of challenges, including power shortages, outdated technology, high production costs, and lack of access to finance. These challenges have led to a decline in the sector’s competitiveness in the international market, making it difficult for Pakistani textile manufacturers to compete with their counterparts in neighboring countries such as Bangladesh, India, and China.
One of the significant factors contributing to the ongoing textile sector crisis in Pakistan is the lack of technological advancement. Most textile manufacturers in Pakistan still rely on outdated machinery, making it challenging to compete with manufacturers in countries that have adopted more advanced technology. The cost of upgrading machinery and equipment is high, and many manufacturers are unable to invest in modernization due to financial constraints.
Moreover, the high cost of production, including the cost of electricity, gas, and labor, has made it difficult for manufacturers to remain competitive in the global market. The cost of electricity and gas in Pakistan is significantly higher than in neighboring countries, making it challenging for manufacturers to maintain a profitable business.
Inadequate government support is another significant factor contributing to the ongoing crisis in the textile sector. Despite being a significant contributor to the country’s economy, the government has not taken sufficient measures to deal with the crisis.
