Despite falling textile exports, demand for Al-Karam products on the rise

  • Textile Mills vice president Sumrin Ali says foreign buyers fully satisfied with Al-Karam

Despite a declining trend in the national textile exports for the past three years, the exports of Al-Karam Textile Mills have been persistently increasing, as the company surpasses its Indian and Bengali competitors in producing high quality products.
“Our international buyers are not satisfied with the product of our competitors in Bangladesh and India since we – Al-Karam Textile – produce better quality products. However, Indian textile companies remain the biggest challenge for Pakistani exports in the international market,” said Sumrin Ali, the company’s vice president, in an exclusive interview with Pakistan Today.
“International buyers tend to shift to other countries, especially India, only because of the cost factor. Besides, China, India and Bangladesh support their textile industry during the global crisis. For instance, India has been providing five per cent interest rate subsidy to its textile industry,” she added.
Pakistan’s textile exports had dropped 8.15 per cent ($9.363 billion) in the first nine months of the current fiscal year.
“Al-Karam Textile exports increased 14 per cent in 2014-15, compared to the previous year,” she said, adding “the company’s exports stood at $148.637 million in 2014-15, against 2013-14’s $130.563 million”.
Pakistani textile industry is facing tight monetary policies, extra taxes and other SROs of the federal and provincial governments.
“Governments have to step up and save the local textile industry. There is a huge potential of Pakistani products in the international market but the image-building of Pakistan not only as a quality textile producer but also as a politically stable country is very important for exporters,” said Sumrin.
While most of Pakistan’s textile units do not have any testing protocol like international markets, Al-Karam is fulfilling all the international testing protocol, including colour, stitching, dying and others, to boost exports to the US and Europe. “We export 35 brands globally. These are 100 per cent locally-produced items. We are vertically integrated and have our own in house designing, spinning, printing, weaving, processing and stitching departments producing all products at our facilities under one roof. There’s a lot of demand for our products globally because of huge range of designs, fabric, stitching, spinning and other quality standards,” Sumrin said.
“Our products like “bed in a bag”, pillows, fashion bedding, quilts, duvets, comforters, sheets, blankets, curtains, shower curtains and kitchen linen are very famous in the US and European markets,” she added.
According to Sumrin, the fiscal year of 2013-14 was the best exporting year for Al-Karam in which the company’s exports grew by 23 per cent (to $130.563 million).
“The demand of Al-Karam’s products is rising in American and European markets, but the problems is that the buyer is not ready to come to Pakistan because of the law and order situation and poor road infrastructure,” she claimed.
Sumrin said that “the company has also launched a complete range of baby bedding products for which we use organic cotton especially being imported from Egypt”. “Our company imports high quality cotton from India and Egypt as quality fabrics cannot be produced from local cotton. During the past year, the company imported high quality cotton of over Rs 300 million from India. There are lots of factors that influence cotton fiber quality. The general quality parametres are the length, uniformity, micronaire and strength. These parametres depict the quality of cotton,” she added.
According to Sumrin, the company does not export garments (suiting) to any international market; however its retailers in Pakistan might send small consignments of these local products abroad. She said the company received order online from international buyers especially from Europe and the US and worked with big retailers’ like Wall Mart, Bed & Bath and others.
“We do not have any competitor in Pakistan because of our quality products and the best skilled designing, weaving etc. Our products are in demand only because of the unique designs and fabrics we produce.”
Similarly, Al-Karam has its own retailers and vendors in Pakistan, while international value-added customers are Chaps, Lauren Conrad, Ralph Lauren, Macy’s and BBB. We also have our own luxury bedding brand “Royal Borough” placed at Neiman Marcus.
After the recession hit textile businesses all over the world, local textile industry experienced decline in exports due to the government’s policies in terms of finance and inflation as well as energy crisis. “The high cost of production resulting from an instant rise in the energy cost has been the primary cause of concern for the local industries,” said Sumrin.
“Another major factor is the devaluation of Pakistani rupee. We have experienced a decrease in terms of dollar’s value by 14 per cent,” she said, adding, “Apart from these two, we also don’t have a concept of Research and Development (R&D) not only in the cotton sector but also in the industry itself. Al-Karam, which is a vertically integrated operation, has recently added a competitive R&D department in the company which will focus on an ambitious target of taking on R&D process from fibre to the final product.”
In reply to a question, Sumrin said that there might be rare episodes due to external factor; however, the company’s Order Lead Time (OLT) was extremely calculated. “The penalties for not shipping orders on time are huge and you may lose your credibility as a supplier,” she added.
She said that Pakistan’s trade regime and regulatory environment were still restrictive. “Trade diversifications with the EU would help Pakistan rely on commodities other than the textile sector,” she added.
According to PBS data, Cotton cloth fetched $1.685 billion in July-March 2015-16, falling 10.14 per cent over the same period a year ago. The data showed that exports of knitwear and bedwear declined 2.1 and 4.13 per cent to $1.749 billion and $1.505 billion, respectively, in the July-March period over the comparable period.
Exports of readymade garments, however, improved 4.2 per cent to $1.609 billion in the first nine months.
The textile industry in Pakistan is the largest manufacturing industry in Pakistan. After agriculture, it has been the only industry that has generated huge employment for both skilled and unskilled labour. The textile industry continues to be the second largest employment generating sector in Pakistan. Pakistan is the eighth largest exporter of textile products in Asia. This sector contributes 8.5 per cent to the GDP and provides employment to about 15 million people or roughly 30 per cent of the 49 million workforce of the country.
Fawad Anwar is the owner and Managing Director of Al-Karam Textile Mills Limited.