Plan to invest $1 billion in new value added textile projects

Encouraged by the government’s initiatives to help reduce the cost of energy for exporters, major Punjab-based textile groups on Friday announced that they plan to invest $1 billion in new value-added textile projects and capacity expansion for exports.

The group that plans to invest include leading textile manufacturers such as Sapphire, Suraj, Kamal, US Apparel, Interloop, Fazal Cloth Mills, Ejaz Group, Mahmood Textile, Ayesha Group, Bhanero Group, Kohinoor Mills and Sadaaqat Textile.

The All Pakistan Textile Mills Association (Aptma) said the government’s policy of providing relief to the textile exporters through reduction in power and gas prices to $0.075 a unit and $6.50 per mmbtu and availability of Long-Term Finance by the State Bank of Pakistan (SBP) has encouraged these groups to invest in new capacities for export of value-added textiles.

“These groups are taking major initiatives in textile expansion in downstream to consume and convert available basic textiles to home textiles, towels, socks, knit apparel and clothing in a bid to enhance exports by $2bn through value addition and generate one million jobs,” Aptma Chairman Syed Ali Ahsan said.

The government had announced and implemented various initiatives to ensure regionally competitive energy — both electricity and gas —- to the export-oriented five zero-rated sectors. Consequently, viability as well as confidence of the industrialists and prospective investors has been restored.

Thus the industry, all across the value chain, started preparing a policy framework to achieve an export target of $50bn in five years, which will attract huge investments and create 15m direct work force opportunities in line with the manifesto of the present government.

The Aptma chairman dispelled the impression that export of yarn was impacting the value-added industry. “The export of yarn has declined by 24 per cent in quantity terms in the month of March and the quantity per month exported is still 44pc lower than the maximum export quantity of yarn at 60,000 [tonnes] per month,” he clarified.

“More than 80pc lower count yarn (below 20) being exported are not in demand of the domestic industry,” he added.

Courtesy: Dawn