The textile sector in Pakistan had remained stagnant over the last decade due to a number of exogenous and indigenous factors. Under the Pakistan textile policy (2015-19), incentive of Rs 64.15 billion cash subsidy to the textile and clothing sector has been announced which would boost the exports to $ 26 billion by 2019. The incentive package carries special duty-drawback rates, duty exemption on plants and machinery and subsidy on long-term loans.

The Finance Division would provide Rs 40.6 billion over five years for duty drawback, technology up-gradation and brand development while another Rs 23.5 billion would be provided for skill development, dedicated textile exhibitions, establishment of world textile centre, weaving city, incubators, apparel house and mega textile awards.

Also around 120,000 persons would be trained through skill development programme and 50 small companies from the sector would be picked each year, for next three years, to support the government. The proposed measures would promote value-addition and generate employment for more than 5 million people, the sources added.

They said the sector contributes to provide employment to about 40% of industrial lab or force, and consumed about 40% of banking credit to the manufacturing sector.

Barring seasonal and cyclical fluctuations, the textiles products had maintained an average share of about 54% in the national exports.

On the domestic side, cotton production had remained stagnant at about 13 million bales per annum and the resistance to grading and standardization of cotton bales by ginners and spinners alike had consistently lowered the value of Pakistani cotton by around 10 cents per pound in the international market.

On the other hand, the value-added garments sector had grown marginally due to its limited product range, low usage of manmade fibres and inability of manufacturing units to restructure in order to meet the changing international requirements.

On the performance of textile industry, the sources said that it was the most important manufacturing sector of Pakistan and had the longest production chain with inherent potential for value addition at each stage of processing, from cotton to ginning, spinning, fabric, dyeing and finishing, made-ups and garments.