Textile exports down 5% in Feb, value added textile shipments decline by 9%

The textile exports of the country declined by five per cent on month-on-month basis to $1.02 billion, while the value added shipments declined by 9 per cent to $597 million, data released by Pakistan Bureau of Statistic Tuesday night revealed.

However, the basic segment witnessed a three per cent increase to $293 million in February last, the PBS data said.

Textile exporters were waiting for a much-delayed Trade Policy announced by the Commerce Ministry on Tuesday but there are no incentives for the textile sector even though the government has announced some incentives on machines imports etc, textile exporter Shabbir Ahmed told Pakistan Today.

He said that Prime Minister Nawaz Sharif had already announced reduction in power tariff and zero-rated facility for exports from the next fiscal year to facilitate the exporters. The government had also promised the exporters to resolve the gas shortage issue by importing RLNG. The minister has said Rs 6 billion have been allocated for incentives to exporters for promotion of exports.

“The new policy is based on four pillars including product diversification and sophistication, increasing market access, institution developing and trade facilitation,” he said.

Within the value added segment, the data said, the dollar amount netted by Knitwear and Readymade Garment fell by 16 per cent and 10 per cent MoM respectively. Although average realised prices remained stable around December 2015, discounted levels were down 6-8 per cent in November 2015).

Volumes slipped by 16 per cent and 11 per cent for Knitwear and Readymade Garments respectively as the winter demand spike tapered off, the data showed.

Basic textiles inched up three per cent MoM as Yarn exports recovered 20 per cent MoM to $106 million (off-take improved 22 per cent while average prices dipped two per cent).

However, on a YoY basis, yarn exports plunged by 38 per cent during February 2016.

Local supply-side factors coupled with international demand-side factors have taken a toll on textile exports.

The market analysts said the recent approval of Strategic Trade Policy Framework (2015-18), reduction in industrial electricity tariff, commencement of LNG imports, and the potential zero rating of textile exports along with further depreciation of Pakistani rupee bode well for the industry.