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Group Members

y Javaria Khalid (090528-019)y Nida javaid (090528-004)

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History Increase in the cotton production and expansion of

textile industry has been impressive in Pakistansince 1947.

Number of mills increased from 3 to 600.

spindles from about 177,000 to 805 million.

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Introduction & Importance

Backbone of the economy

From a most non-existence at the time of creation ofPakistan in 1947, the Textile industry has grown intothe largest and most significant economic sector ofPakistan.

Plays pivotal position in the exports of Pakistan.

Status of being the largest industry in Pakistan

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Introduction & Importance

Pakistan is the 8th largest exporter of textileproducts

Has the comparative advantage of resourceutilization

Major contributor towards GDP

50% of industrial labour force

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Introduction & Importance

Earns 65% foreign exchange of total exports.

The industry consists of large-scale organized sectorand a highly fragmented cottage / small-scale sector.

The industry consists of large-scale organized sectorand a highly fragmented cottage / small-scale sector.

At present, there are 1,221 ginning units, 442spinning units, 124 large spinning units and 425small units which produce textile products.

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Introduction & Importance Manufacturing sector. 46%

Export earnings... 68%

Value addition. 09%

Employment 38%

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MajorCrisis

High interest rates

High cost of inputs

Non conducive government policies

Non-guaranteed energy supplies hinder theircompetitiveness

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MajorCrisis

Non-guaranteed supply of power by WAPDA isanother problem that negatively affects the textileindustry. Although, some textile units have builttheir own energy generating plants to cut cost (theseunits run on gas), small units production dependsentirely on the electricity supply of WAPDA.

The textile industry suffered heavy financial lossesin Dec, Jan and Feb quarter, because of theinconsistent electricity supplies

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MajorCrisis

The lack of production subsequently resulted in theindustry not meeting its target for the quarter,massive financial losses were borne by textile ownersand sadly, it hit the most vulnerable: workers on

daily wages.

After surviving from the load-shedding scenario the

industry has yet to survive the gas load shedding.

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Conclusion

Textile industry is feeling the pinch of increase inpower interest rate, inflation and multiplicity oftaxes, which have increased the production costs.

Productivity have further deteriorated due topower break down civil riots and otherdisturbances and thus adding to the cost of theproducts.

Labour costs are amongst the lowest in the world,the benefit is being wasted through operationalinefficiency.

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Recommendation

Investments in developing human skills andknowledge essential for upgrading competitiveadvantages

The commercially viable units may be consideredfor revival by providing financial relief.

Govt must granted a number of incentives for thedevelopment of value added products

.

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Recommendation Liberalized labour laws, tax and other benefits of

a Special Economic Zone need to be implemented

Access to high quality and cost-effectivemanpower

Excellent connectivity by road, rail air and ports

Single-window clearance

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THANK YOU