View Full Version : Pakistan's Textile Industry
March 21st, 2009, 01:58 PM
Chinese companies to support in revival of sick textile units: Baig
KARACHI (March 20 2009): The government is creating Resolution Trust Company for the revival of sick textile units with the support of Chinese companies who have agreed to invest in these units, Federal Advisor on Textile Dr Mirza Ikhtiar Baig said this at the launching of 6th Textile Asia 2009 on Thursday.
He said that presently there were about 90 sick textile units, which were closed in 2008. These old units will be merged and revived, he added. He pointed out that government was working on liquidation laws and bankruptcy laws for a respectable closure of business. Failure and success is a part of the business and entrepreneurs should be allowed to declare bankruptcy and liquidation of failed business, he noted.
Referring to measures to boost countrys textile exports, Dr Baig said that the government has hired two top consultants of the world, M/s Warner International of USA and M/s Gharzi Intl of Switzerland to find out weaknesses in our textile exports and suggest ways to boost exports. They will tell us how the world is moving and how our textile sector should move, he added.
He opined that Nicole Monti of Warner USA already had a meeting with top authorities in Pakistan while the top executives of M/s Gharzi will visit Pakistan soon and meet the authorities. Textile Advisor said that these consultants have informed the government that apparel sector in Europe was planning relocation of their units in other countries.
"They can come to Pakistan if they are provided enabling environment here. The consultants have pointed out that at least 25 leading international brands including Gale and Tommy Hilfiger. I have given a list of ten brands to these consultants and they will co-ordinate with them so that they can relocate their plants in Pakistan", he added.
Talking of high cost of doing business, the advisor said that the country would get away from a cross subsidy, which was benefiting fertiliser business at the cost of industrial sector.
He said that efforts were on to get duty access in European Union for the textile sector. Much progress has been made at the joint ministerial meeting of Pakistan and EU in this regard. We will get you duty free access in EU, he maintained. Talking of other incentives to textile sector, he said that duty drawback on local purchase will be provided to exporters and Textile Ministry has moved a summary to the government in this regard. This is a substitute of R&D scheme.
Dr Baig said that exporters have started receiving checks against R&D claims involving Rs 4 billion and the payment against the remaining Rs 6 billion will be made to exporters soon. He said that the textile sector would be made zero rating regime in the coming budget. He appreciated the efforts of E-commerce Gateway in organising the exhibition.
Earlier, Textile Commissioner Idress Ahmed said that $7 billion were invested in textile sector of Pakistan in plant and machinery between 1999 and 2008 for capacity building. Textile Commissioner Idress Ahmed and President Ecommerce Gateway were also present on the occasion.
March 21st, 2009, 02:05 PM
R&D support demanded to rescue textile sector
FAISALABAD (March 21 2009): Zero rating of textile exports and continuation of Research and Development (R&D) support is the sole way out of present crisis confronting countrys textile exports, which will restore competitive edge in the international markets. Unanimous demand to buttress the falling exports of textile and review the sickening industrial sectors was voiced by the exporters in the executive committee meeting of Pakistan Textile Exporters Association (PTA).
Briefing the newsmen, Chairman, PTA, Muhammad Yousaf and Vice Chairman, Rehan Naseem Bharara said that the impact of world economic meltdown has started blemishing Pakistans textile, as 25percent of weaving industry and 50percent of ancillary supply units have closed down in the upcountry textile centres. This has resulted in large-scale lay off in thousands of workers in handloom or power loom units. Enormity of the approaching sunami could be gauged from the sleep decline in exports of first two months of new Calendar year with 6.94percent decline in January and 17.68percent drastic downslide in February, they emphasised.
The exporters are facing twin menace of lack of export orders and refusal to accept destined consignments as well as default in payment of accepted and cleared goods, the meeting stated.
As a result of international recession, the traditional foreign buyers are not placing orders, rather they are refusing to accept the consignments that have already reached their ports or which are on the way at high seas, the PTA member said.
Further, many buyers are defaulting on payments of goods accepted, cleared and received in their goodowns, they elaborated. It was pointed out that 129 containers of Pakistani exporters have been stuck up in Moscow-Russia, as the buyers are defaulting in payment due to drastic 40percent devaluation of Russian rouble, they said.
Similarly, the buyers in Chile, after releasing the goods, are not reimbursing the payment and even not replying to our queries resulting in blocked of huge funds of exporters augmenting liquidity crunch, the PTEA Chairman said. The PTEA Chairman demanded that all the burdensome duties levies, taxes surcharges and overheads on textile exporters may be removed and textile exports should be totally zero rated and assisted to become competitive internationally, as was being done by our regional rival countries.
March 21st, 2009, 02:35 PM
European Union and USA: duty free access to help boost textile export
KARACHI (March 20 2009): Ministry of textile is working for duty free market access on export of Pakistan textile products to European Union and USA to boost the countrys textile export. While, talking to newsmen Dr Mirza Ikhtiar Baig, Federal Advisor on Textiles, at Soft launching of 6th Textile Asia 2009 Intl exhibition said that duty free access would help to boost the textile exports.
On the occasion Dr Khursheed Nizam, President Ecommerce Gateway, Sohail Aziz, Executive Director, Muhammad Idrees Ahmed Textile Commissioner of Pakistan, Asif Rasheed M.D Al Murtaza Machinery and President TEXMAP Pakistan Abbas Moraj also addressed the Soft Launching Ceremony.
"Ministry already have arranged meeting ambassadors of Italy, France, Netherlands, United Kingdom, Turkey and Germany and they all assured their support for allowing duty free export of our textile goods to their markets", Dr Baig added.
He pointed out that government is also working on liquidation laws and bankruptcy laws for a respectable closure of business. Failure and success is a part of the business and entrepreneurs should be allowed to declare bankruptcy and liquidation of failed business, he said.
Referring to measures to boost countrys textile exports, Dr Baig said that the government has hired two top consultants of the world, M/s Warner International of USA and M/s Gharzi Intl of Switzerland to find out weaknesses in our textile exports and suggest ways and means to boost exports. They will tell us how the world is moving and how our textile sector should move, he added.
Talking about high cost of doing business, the advisor said that the country would get away from a cross subsidy which was benefiting fertiliser business at the cost of industrial sector. "Duty drawback on local purchase will be provided to exporters and textile ministry has moved a summary to the government in this regard, which would be a substitute of R&D scheme", he informed.
He said that government has given some Rs 4 billion for the pending R&D claims and exporters have started receiving cheques against R&D claims, while the remaining Rs 6 billion would be made to exporters soon.
Appreciating the holding of Textile Asia, he said that "its a matter of proud for all of us that Textile Asia is the only Textile & Garment Machinery show of Pakistan and India which is a UFI Approved Event by the Global Association of Exhibition Industry, Paris- France.
I am confident that Textile Asia would attract the foreign investors towards the potential of our textile & garment sectors," Dr Baig said. This world-wide recognition achieved by Dr Khursheed Nizam and Ecommerce Gateway reflects the proof of high quality, thus providing exhibitors and visitors alike with the assurance that they will benefit from a professionally planned and managed concept, he said.
"6th Textile Asia 2009 Intl Exhibition to present revolutionary technologies of more than 329 international brands from 32 countries," said Dr Khursheed Nizam President Ecommerce Gateway.
He said that Textile Asia Intl Textile & Garment Machinery Show is being organised for the 6th consecutive year from 5th to 8th April 2009 at Karachi Expo Centre. He said that there is a huge potential for international textile and garment machinery manufacturers to tap this market.
He said that more than 30,000 local trade and corporate visitors and more than 100 foreign delegates are expected to attend Textile Asia 2009. "The event is designed to act as a podium where it will highlight the products and services of the textile industry not only of Pakistan but also of the International forum," Dr Nizam added, He said that Textile Asia would provide such a platform to SME sector where all the relevant decision makers jointly visit, test and purchase machineries.
March 26th, 2009, 11:34 PM
Top US lobby for cut in tariffs on Pakistani textiles
WASHINGTON (March 26 2009): The top US business lobby Tuesday urged a cut in US tariffs on Pakistani textiles, saying that trade would be a valuable part of the new US strategy to bring stability to Pakistan. The US Chamber of Commerce and US-Pakistan Business Council issued a report welcoming President Barack Obamas focus on rooting out extremism in Pakistan and neighbouring Afghanistan and urging an emphasis on trade.
US Chamber of Commerce and US-Pakistan Business Council have issued a report welcoming President Obamas focus on rooting out extremism in Pakistan and Afghanistan and urging an emphasis on trade. "Stronger and more stable economic relations between the United States and Pakistan would help advance Americas overarching geopolitical goals in South Asia," the business groups said in the report.
The United States is the largest investor and market for Pakistan, which in November required a 7.6-billion-dollar emergency credit line from the International Monetary Fund as world economic crisis hit the nation. The business groups urged a review of US tariff policy on Pakistan, saying that the duties on Pakistani textiles were higher than those from other key producers.
The report also backed a proposal by two lawmakers - Senator Maria Cantwell and Congressman Chris Van Hollen - to make certain products made in the impoverished Afghan-Pakistan border regions duty-free. In the long term, the United States should consider entering negotiations on a free-trade agreement with Pakistan, the groups said.
"Although the United States stresses the importance of economic growth in Pakistan, American trade policy fails to provide increased market access for Pakistani products in the United States," the report said. The report supported early legislation on the initiative of establishing reconstruction opportunity zones in the Pakistani border regions with Afghanistan, saying the move would provide incentives for investment in the impoverished areas by allowing duty-free export to the United States.
The two organisations applauded Kerry-Lugar initiative in the Senate to triple economic assistance for Pakistan to 1.5 billion dollars annually. They also emphasised bolstering the availability of the US Export-Import Bank and other government financing and insurance to stimulate American private sector investment in Pakistans energy sector.
"In addition to its strategic elements, a broad-based relationship with Pakistan needs to include enhanced co-operation in the areas of trade and vestment and energy security," said Chambers Senior Vice-President of International Affairs and member of the board of directors of the USPBC Myron Brilliant.
"We are actively working with both governments to strengthen our economic ties." The United States is the largest trading partner of Pakistan. Pakistans port total exports in 2007-08 financial year totalled 19 billion dollars, of which 20 percent or 3.7 billion dollars went to the United States.
The US exports to Pakistan rose to nearly two billion dollars in 2008. "Our report also urges the US government officials to work with Pakistan to address bilateral trade and investment opportunities," said Chairman of the board of directors of the USPBC Jay Collins.
"Our members stand ready to contribute to efforts to expand commercial relations between the two countries." Also, the leaders of the two organisations urged the Department of Homeland Security to provide expeditious approval for non-stop flights to the United States from Pakistan as direct flights from Lahore to New York would facilitate trade and investment links. The following are the key recommendations for the Obama administration and members of Congress:
-- Obtain passage of the US foreign assistance legislation, showing that the United States is committed to ensuring Pakistans long-term prosperity.
-- Address trade and investment practices with Pakistan to ensure that American companies find a level playing field.
-- Approve legislation creating reconstruction opportunity zones (ROZs) to promote economic development in Pakistan.
-- Conclude a high-standard bilateral investment treaty with Pakistan to provide safeguards for the US investors.
March 26th, 2009, 11:37 PM
1.4 million bales of cotton worth Rs 20 billion imported
ISLAMABAD (March 26 2009): Pakistan during the last eight months (August 2008-March 2009) imported 1.4 million bales cotton, worth Rs 20 billion, from India, USA and Brazil, while during the corresponding period of last year 3 million bales were imported, costing Rs 40 billion.
Sources told Business Recorder here on Wednesday that about 0.1 million bales were imported from India, costing Rs 1.5 billion. They said that the country might have to import 2 million bales cotton, instead 1.4 million bales, during the current season.
The recent cotton arrivals report from PCGA, up to March 15, showed that the production of the crop amounted to 11.30 million bales. The contribution of Punjab in cotton production was 8.3 million bales and the share of Sindh was 2.9 million bales.
According to sources, the country may face a shortage of about 2 million bales for 2008-09. Earlier, Pakistans Cotton Crop Assessment Committee said that the country might achieve the cotton production target of 12 million bales for 2008-09. It shows that the country may face 15 percent shortfall in production as compared to the set target.
June 1st, 2009, 08:48 AM
The Pakistani textile sector has received an offer from the government of France to open a buying house in France, where the whole Pakistani textile sector can open a combined buying house with the full support of French government.
The offer has been made by the French Commercial Counselor in Pakistan Mr. Dominique Simon, in a meeting with Faisalabad Chamber of Commerce and Industry (FCCI) and representatives of textile association. He also offered facilitation for getting visas to people going to France for business.
The French Counselor said in the meeting that the energy crisis, rise in input costs and economic slowdown are the factors affected the industry drastically. Further he mentioned that the Bangladeshi textile producers export their products to all the European markets due to supportive trade facilities.
Buying houses from European countries have set up shop in Bangladesh, which keeps Bangladesh textile industry updated regarding the changes in fashion, so Bangladesh produces textile products according to the ongoing fashions.
In this regard, the Pakistani textile producers were left with the only option of opening a combine buying house in France as due to the law and order situation in Pakistan no one wants to come to Pakistan for business and now this option is expected to lend a helping hand to whole Pakistani industry.
The Pakistani buying house in France will approach the fashion and garment companies in France, will market its products and pitch for orders. At the same time, it would update the textile industry regarding the changing fashions in France, so that the Pakistani textile industry could follow French trends and fashions.
Once the Pakistani products build trust within the French apparel and fashion industry, the French industry will start setting up bases in Pakistan, once the law and order situation changes for the better.
June 1st, 2009, 05:37 PM
How come the French are warming up to us all a sudden?
June 1st, 2009, 09:24 PM
They've also opened an Emirati base, so it's pretty clear.
June 30th, 2009, 08:30 PM
The federal government has allocated Rs.40 billion for an Export Investment Support Fund, to support the exports of the value-added textile sector.
The Pakistani government has pledged to set up the Export Investment Support Fund to boost the country's textile export earnings as part of the federal budget for 2009-10. The government plans to give an enhanced duty drawback to value-added textile exporters instead of providing support for research and development.
Additionally, there is also a summary to withdraw the 12.5 per cent cross subsidy on gas, to mainly benefit the spinning sector. Schemes to open warehouses and marketing offices abroad are also being worked on, Dr. Mirza Ikhtiar Baig, the Federal Advisor on Textiles said.
He also said that, Rs.500 million has also been earmarked as a three per cent interest rate subsidy for the textile industry and Rs. 510 million will be spent on establishing the necessary infrastructure to support export oriented textile and clothing firms.
Baig said in a statement on Monday that 67 per cent of the Export Investment Support Fund will be spent on the textile and clothing industries, with hopes of moving the sector towards consolidation and value addition.
In this budget, the Federal Excise Duty (FED) on the import and supply of viscose staple fiber has been withdrawn.
Additionally, the textiles industry will be given priority in the allocation of gas and electricity, as the industry is the first priority of the government, Baig said. The government also plans to establish large export houses, and launch a National Trade Corridors Improvement Program, the advisor added.
The budget also contains allocations for different textile and garments city projects throughout the country. The Infrastructure Development of Pakistan Textile City Project was recently launched in Karachi and soon Faisalabad Garments City Project would also be launched, Baig said.
Rs.246 million has been earmarked for Textile City Karachi, Rs.207 million for the Faisalabad Garment City Project. Additionally, Rs.25 million will be spent on the Lahore Garment City Project, as well as Rs.17 million for upgrading Textile Institutes and Rs.15 million for the Export Development Plan.
Additionally, Baig said there was a proposal for the disbursement of a three per cent to four per cent mark-up on investment against plant and machinery in textile sector. This will be similar to the Indian Technology Upgradation Fund (TUGF) scheme and will be announced in the upcoming textile policy.
July 1st, 2009, 04:52 AM
These are just ways to make us fools textiles industry was doing good on its own, if u earning than you are gonna invest in ur business as well:bash: the point is that if you cant provide electricity the mills are gonna close not everyone has got the money to buy big generators specially for looms as they take alot of electricity and even if u buy them u cant run those generators for 12 hours out of 24. On top of that you got sales tax, you got quota than very high interest rates not having skilled labour ALL these things count and all these politcians are bothered about is filling there own pockets.
PAkistan was on top in asia at one time now china, india, bangladesh even srilanka is doing better than pakistan and that makes me wanna cry.
September 1st, 2009, 01:37 PM
Iranian market awaits Pakistani textile products
Associated Press of Pakistan
KARACHI: Commercial Counsellor, Embassy of Pakistan in Iran, M. Saeed Khan Jadoon during his visit to FPCCI said volume of trade between Iran and Pakistan has shown significant increase of 86% at 400 million dollars, whereas the potential available is 600 million dollars.
The main hurdle of trade between two countries is Banking sanction and LC matter , and this issue has been discussed with the SBP Governor, he said in a meeting with President, Federation of Pakistan Chambers of Commerce and Industry Sultan Ahmed Chawla and a group of other senior businessmen, here at Federation House, said FPCCI statement on Monday.
In the meeting, the matters related to promotion of trade and investment between the two brotherly countries were discussed. President FPCCI Sultan Ahmed Chawla said Pakistan and Islamic Republic of Iran share common borders, religious, cultural and social values which make theses two countries very special friends.
He mentioned that textile and bed linen products are very potential in Kish island of Iran which is a Taxfree Zone. Pakistani textile giants should open an outlet there which is a tourist spot. He was of the view that Pakistan should allow flying rights to Iran Air to carry out operations beyond Pakistan and similarly to PIA which will definitely increase commercial traffic.
The Government should allow freight subsidy on Plastic items which are in great demand in Iranian Markets.
September 1st, 2009, 02:50 PM
anyone knows our total textile exports? or preferably a break-down of our export for financial year 2008-2009?
September 1st, 2009, 07:05 PM
anyone knows our total textile exports? or preferably a break-down of our export for financial year 2008-2009?
KB Ji :
Aap Ki Seva Mein :
STATE BANK OF PAKISTAN
Statistics and Data Warehouse Department
EXPORT RECEIPTS BY COMMODITY (http://www.sbp.org.pk/ecodata/Export_Receipts_by_Commodity.pdf)
Ahmad Rashid Ahmad
October 13th, 2009, 02:22 AM
Though foreign buyers consider Pakistan being the cheapest source of coarse cotton textiles, they have withheld orders on concerns textile manufacturers will not be able to make deliveries on time because of energy and power shortages.
The News has found that the demand for coarse cotton yarn, denim cloth and knitwear is on the rise in the global market. Exporters point out that the buyers always appreciated quality of these Pakistani products which before 9/11 fetched higher prices than competing economies. However, after the threat of terrorism emerged, the buyers shifted bulk of the orders to other countries without totally abandoning quality exporters of Pakistan.
All Pakistan Textile Mills Association’s former chairman Akber Sheikh said despite acute power and gas shortages the industry never failed to meet export schedule even if it had to produce power and use energy at a higher cost.
However, he added, the foreign buyers took very seriously protests by the textile sector against suspension of gas and electricity supply. As a result, they withheld orders. “Fall in orders has forced around 50 per cent of the clothing industry to close,” knitwear exporter MI Khurram said. He said the buyers also exerted immense pressure on surviving mills to reduce prices which they did by improving their efficiency to the maximum level.
“Now quality and rates are not an issue for the exporters who are operating on very thin margins.” He said possibilities of increasing exports were bright as margins would improve once the facilitations announced in the textile policy were made available.
Though the Ministry of Textiles had issued necessary circular for availing of benefits of the textile policy, the finance ministry had not issued supporting SROs which would allow the central bank to provide three per cent rebate on export of clothing or reduce interest rate for import of machinery, he said. “Even the SRO to release withheld research and development grants has not been issued.”
Another clothing exporter, Adil Butt, said the textile sector was at recovery stage. “Export orders have increased, mills are rapidly utilising idle capacities and entrepreneurs are trying to buy closed units.”
However, he added, banks were too slow in addressing their issues with the sponsors of sick units making it impossible for prospective buyers to take over these units at reasonable rates. He said Pakistan Electric Power Company (PEPCO) was also creating problems for the value added clothing sector as it considered only the spinners as textile units.
He said clothing units at Multan Road were facing loadshedding for eight hours in a day, though PEPCO had announced power outages for only three to five hours for the textile sector. “The opportunity available now will be lost if the government fails to improve its institutions like power supply and gas distribution companies.”
Clothing exporter Sheikh Zafar Mehmood, who had just negotiated an export order with a multinational brand, said the deal was based on facilitation provided by the government in the textile policy.
However, he regretted the policy was a non-starter from the beginning. He said the textile ministry had linked provision of incentives to registration of textile exporting units with the ministry. Though online registration was allowed, the site of the ministry was clogged and registration was not possible. He said “foreign buyers have now admitted Pakistan is the cheapest source of knitwear products in the world. Their concern, however, is timely delivery which they doubt given the power and energy shortage and deteriorating law and order situation.”
Ahmad Rashid Ahmad
March 3rd, 2010, 08:18 PM
The textile industry of Pakistan is more vulnerable to global recession than its competitors as its share in domestic market is limited to 20 per cent although the local consumption of fibre is equivalent to over 40 per cent of its production capacity.
The textile experts say that the industry’s share in the domestic market has been eroded by free flow of used or worn clothing and rampant increase in smuggling of ladies fabric along with readymade garments being brought in the country through personal baggage.
The All Pakistan Textile Mills Association (Punjab) former chairman Akber Shaikh said that other major textile exporting nations like India and China are better able to withstand the pressure of reduced exports due to global recession or any other factor because they have larger shares in their home markets.
He said the only difference between these two countries and Pakistan is that they have better controls on their borders that effectively check smuggling of foreign fabric or other textiles. These countries discourage import of worn clothing.
The customs in China and India strictly monitor global rates and do not clear under invoiced goods.
Akbar Shaikh said there is a huge demand for Pak made ladies cotton fabric in India but its smuggling is checked and its import is subjected to high duty based on minimum duty payable per kg that makes the fabric costly.
On the other hand he added smuggled Indian and Chinese fabric is freely available in all cloth markets of Pakistan.
A study by The News revealed that Pakistan imported 263.371 million kg of used (or worn) clothing worth Rs7.685 billion in 2008-09. This means that the per capita used clothing consumption in Pakistan is 1.62 kg.
The Indians on the other hand imported only 43.640, which translate into per capita consumption of worn clothing in India to only 0.03 kg.
Another point worth noting is that the imports of worn clothing are rapidly rising in Pakistan, which stood at 174.592 million kg in 2007-08 and the per capita worn cloth consumption in the country was 1.07 kg. The quantum of smuggling can not be evaluated.
However a visit to any market in Pakistan would reveal that most of the blended ladies fabrics in Pakistan are smuggled in to the country. Ladies usually prefer blended fabrics.
The children garments also find their way in large quantity through personal baggage. Ladies constitute 50 per cent of our population.
Assuming that the smuggled quantity is equivalent to that of worn clothing then smuggled ladies fabrics also account for 1.62 per capita consumption of fibre.
Children garments and other textile imports account for another 0.5 kg per capita consumption of fibre.
It was also found that the local textile industry produced 3,040,910 ton of fibre in 2008-09 out of which 20 per cent or 615,314 ton was consumed in the domestic market and the rest was exported. This is equivalent 615.314 million kg or per capita consumption of 3.62 kg.
The cumulative use of foreign processed fibre in Pakistan is 3.74 kg per capita (1.62 kg worn clothing 1.62 kg ladies blended smuggled fabric and 0.5 kg children wear). This is a little higher than the per capita consumption of the locally processed fabric in the country.
This means that the consumption of local fabric could be doubled if the influx of foreign processed fibers is effectively checked
March 4th, 2010, 12:00 AM
That's so retarded. Pakistanis only have 20% of their own domestic market. The sooner we raise the potential in our domestic market, the sooner our companies can expand outside of the country.
Ahmad Rashid Ahmad
March 4th, 2010, 08:39 PM
That's so retarded. Pakistanis only have 20% of their own domestic market. The sooner we raise the potential in our domestic market, the sooner our companies can expand outside of the country.
It becames even more disguisting by the fact that it is our main industry.......:ohno:
Ahmad Rashid Ahmad
June 23rd, 2010, 10:23 PM
The Federal Bureau of Statistics (FBS) said on Tuesday that textile exports shared over 50 percent of the total exports during the first eleven months of the current fiscal year.
Textile exports stood at $9.324 billion and contributed 53 percent in the total exports of $17.6 billion during July-May 2009/10.
The other major contributors are manufacturing group, which shared by 19.21 percent with $3.381 billion followed by food group 17 percent and $2.992 billion, petroleum and coal 5.06 percent or $890.629 million and miscellaneous exports 5.74 percent or $1.01 billion, the FBS said.
The textile exports managed to grow by 6.77 percent despite difficult economic conditions due to war on terror and electricity crisis owing to increase in exports of raw materials such as cotton and cotton yarn. The export of both raw materials fetched $1.486 billion foreign exchange for the country.
In terms of volume, the export of cotton cloth leads in textile earnings with $1.66 billion. It is followed by knitwear $1.587 billion, bed wear $1.573 billion, and readymade garments $1.158 billion.
The exports of manufacturing group posted double-digit growth to $3.381 billion during July-May 2009/10 from $3.272 billion in the same period of last fiscal year. The largest contributor in the exports of this group is pharmaceutical and chemicals, which resulted in inflows of $679.953 million during the period.
The major contributors in manufacturing group exports are, sports goods, $267.195 million; leather tanned, $293.663 million; leather manufactured, $404.742 million; surgical and medical instruments, $206.155 million; engineering goods, $209.673 million; jewellery, $520.123 million; cement, $437.351m.
Around $2 billion rice sale to international market helped the food exports to grow by 7.92 percent in the first eleven months of the current fiscal. The food group exports stood at $2.99 billion during July-May 2009/10 as against $2.77 over the corresponding period of last fiscal year.
Quantity export of rice increased by 50 percent on the back of improved domestic production and higher import demand from countries Kenya, Iran and Saudi Arabia. In addition to rice, fruits and halal meat and meat preparation remained the major contributor to increase in food exports during the period.
The increase in fruits exports has been led by improved harvest, better marketing strategies and improved market access.
The exports of petroleum and coal rose by 16.65 percent to $890.627 million from the previous figures of $763.483 million. An amount of $520 million received by selling petroleum products in the international market whereas $369.99 million received from Naptha sale, the FBS said.
Ahmad Rashid Ahmad
July 21st, 2010, 06:27 PM
Textile exports crossed the 10 billion dollar mark in the financial year 2009-10 on the back of high growth of cotton yarn. Export of textile products totaled $10.244 billion in outgoing financial year, as compared to $9.572 billon in the previous year, registering a seven percent growth. According to Federal Bureau of Statistics (FBS) on Tuesday, during the month of June, the export of textile goods grew 9.81 percent to $921 million as against $839 million of last year. In the year under review, export of cotton yarn surged to $1.417 billion, registering 27.13 percent growth, compared to $1.114 billion in the previous year. Export of raw cotton increased 124 percent to $195 million; against $87 million in the previous year and export of yarn other than cotton yarn also increased 100 percent during the year. Export of cotton cloth and cotton carded or combed decreased seven percent and 24 percent respectively during the said year. In value-added sector, the performance of different textile items remained mixed, as export of some goods fell and others recorded some increase. Knitwear export registered a marginal increase of 1.16 percent to $1.761 billion, as compared to $1.740 billion. Bedwear exports fell slightly by 0.64 percent to $1.723 billion compared to $1.735 billion in the previous year. Export of towels grew by 5.17 percent to $676 million, compared to $642 million, whereas readymade garments grew by 4.33 percent to $1.283 billion, compared to $1.230 billion a year ago.
October 24th, 2011, 01:06 AM
Comparative advantage: American buyers still prefer Pakistani apparel
By Kazim Alam
Published: October 24, 2011
The Pakistani rupee has been depreciating, making the country a choice outsourcing destination.
KARACHI: Despite the chronic energy crisis, the gas shortages, the bombings, the terrorism and the violence, Pakistani apparel is one of the lowest cost options for US-based buyers, cheaper even than Bangladesh, India and China, according to American buyers of textiles.
The cost differentials can be as high as 25%, substantial in an industry that generally operates on low margins for exporters. For example, a hooded sweatshirt, which is made at the rate of $12 a piece in China, is manufactured in Pakistan for $9 to $10. Similarly, a pair of jeans, whose manufacturing cost is $10 in China, costs $8 to $8.50 in Pakistan.
Edward Hertzman, director of business development at Synergies Worldwide, a global sourcing company, explains why that is. “The cost of labour in Pakistan is less than China, India and Vietnam,” said Hertzman, whose company placed $75 million worth of orders with Pakistani textile companies last year.
“As opposed to Bangladesh, Pakistan has its own supply of cotton and fabric, and has more small and medium-size factories. So it is able to accommodate smaller volumes and shorter lead times, which suites the American market,” Hertzman said.
Synergies Worldwide represents about 35 European and American brands and deals with over 80 factories in Pakistan besides operations in India, China and Bangladesh.
Top American brands currently outsourcing their apparel manufacturing to Pakistan include American Eagle, Abercrombie & Fitch, Hollister, Nike, Quicksilver, Kohl’s, Sears, Wal-Mart, Gap, Old Navy and Macy’s.
“The perception is that Pakistan is a difficult and dangerous place to work. That’s not true. I travel to Pakistan at least four times a year. I think Pakistan is a serious place to do serious business,” Hertzman said.
The tariff exemptions that Bangladesh receives from the European Union, under the Generalised System of Preferences (GSP), seems to actually count against Bangladeshi manufacturers among American buyers, since it means that their production capacity was used mainly by large European retailers, leaving little spare capacity for any American firms that want to buy from there.
Also, the lack of domestic cotton production capacity makes it difficult to operate a “just in time” logistics system with Bangladesh, a system that US retailers are used to.
“Americans need to understand that Bangladesh works best when running large, continuous programmes. Also, the buyer must plan for longer lead times for Bangladesh, as the fabric is imported and capacity is booked months in advance,” said Hertzman.
Meanwhile, the cost of apparel manufacturing has increased in China in the recent past. The government raised the minimum wage up to 21% in Jan 2011. With the renminbi getting stronger in the international market, Chinese products are becoming increasingly expensive for foreign buyers.
On the contrary, the Pakistani rupee has been depreciating, making the country a choice outsourcing destination.
Talking to The Express Tribune, Khurram Khalid, who works for an international buying house in Karachi, said China was gradually moving away from textiles. “Chinese are smart people. They know the real money is in hi-tech. Their economy is growing, so they’re moving towards production of specialised goods.”
Another advantage that Pakistan has over its competitors, especially Bangladesh, is good quality, home-grown cotton. Pakistan produces short-staple cotton, which is good for denim, flannels, fleece, knits, polo shirts and t-shirts.
Pakistan also produces fashion goods and niche products better than Bangladesh. “Pakistan has excellent washing, dyeing and finishing techniques, enabling it to create fashion-forward, value-added garments,” Hertzman said.
The readymade garment industry in Pakistan enjoys facilities like duty-free import of machinery and income tax exemption. The Textile Institute of Pakistan also introduced first-of-its-kind, four-year BBA (Honours) in apparel manufacturing and merchandising a few years ago to meet the demand of the apparel industry.
Published in The Express Tribune, October 24th, 2011.
Ahmad Rashid Ahmad
December 20th, 2011, 10:20 PM
Textile sector faces hard time
The economic activities in Pakistan are influenced considerably by the textile sector as evident in its direct contribution to domestic production, financial services and foreign exchange earnings.
According to annual report by State Bank of Pakistan (SBP), the sector has strong implications on socio-economic conditions of the country given its role in employment generation.
Although outlook for textile was fairly positive at the beginning of FY11, the sector had to face privation with intensified power outages and gas shortages. Moreover, devastating floods also affected textile production in H1-FY11. However, during the second half of the year, surge in global cotton prices provided earning opportunities in the form of unprecedented high export prices, which in turn induced production activities.
Consequently, the textile manufacturing witnessed a growth in 10.9 percent in H2-FY11 compared with a YoY decline by 6.5 percent in the first half. Cotton prices started rising sharply in October 2010 and touched a 150-year record level in February 2011 on the back of both supply and demand factors The crop loss in Pakistan and Australia, unfavourable weather in China, declining US inventories and export cap by India also surged prices.
On the demand side, China’s renewed commitment to build up cotton reserves, panic buying as well as speculative positions in futures contracts pushed the cotton prices up.
This rise in cotton prices lead to a broad based increase in textile products across the globe, which helped Pakistan earning record $13.8 billion of foreign exchange through textile exports.
The price impact was so strong earnings from textile exports grew by 44.7 percent in H2-FY11 despite the quantum export.
The bed-wear, towels and cotton yarn declined during this period. There were other textile products, including cotton fabrics, hosiery and silk and synthetic items that witnessed rise in both quantum and value terms driven mainly by relatively stable unit prices and competitiveness losses for Chinese products.
Despite a decline in cotton crop, spinning activities improved during FY11 on the back of fewer cotton exports, stronger cotton imports and healthy margins. Pakistan imported 188 thousand MT of cotton during H2-FY11 compared with 157 thousand MT in H1-FY11. Cotton yarn production increased by 7.6 percent YoY during H2-FY11 compared with 1.6 percent YoY during H1-FY11.
A large part of fabrics export growth in FY11 was temporary and is less likely to sustain in FY12. Export data suggests the increase in fabric export during H2-FY11 was mainly to Turkey.
However, fabrics demand by Turkey may not continue going forward after imposition of safeguard restrictions on textile inputs by Turkish government in July 2011.
The fabric export to Bangladesh may continue to support this sector in Pakistan.
In January 2011, European Union eased rules of origin for textile import from Bangladesh, according to revised rules garment manufacturers in Bangladesh can avail generalised system of preferences (GSP) benefits even if they use Pakistani fabrics as input. This caused an increase in fabrics export to Bangladesh in H2-FY11 onward. Although Pakistan’s exports of apparel (both knitwear and woven garments) increased sharply in FY11, it could not raise its share in the world markets.
The Pakistani manufacturers were struggling with energy shortages and law and order situation that could only uphold their existing market share Particularly, Pakistan lost its share in US market against India in bed-wear category as buyers switched to import higher-end products.
Around 12 percent of Pakistan’s total fabric exports are destined for Turkey.
Bangladesh is a recipient of least developed countries’ (LDC) preferential access to EU market under the GSP.
Accordingly, textile exports from Bangladesh duty free access to EU under Everything but Arms (EBA) scheme (duty free access is available to only LDCs). This makes textile products of Bangladesh more competitive compared with non-recipients of EBA (including Pakistan).
In towels category, Pakistan lost its share against low cost Bangladesh, India and China. It is therefore, safe to conclude textile sector in Pakistan is going to face stiffer competition from neighbouring economies and it would become difficult for it to survive if there is no modernisation in production process and new marketing strategies are not adopted.
Ahmad Rashid Ahmad
February 5th, 2012, 07:34 PM
Textile exports to remain at $12.6 billion in FY12
* Bedware, readymade garments, cotton fabrics not beneficiaries of EU concession
With cotton prices already falling close to its one year low and no major up-tick in volumes, the fibre experts believe Pakistan’s textile sector exports in fiscal year (FY) 2012 would decline by 4 percent to $12.6 billion.
Fibre analyst Shakeel Ahmad said recently approved 75 lines of textile and leather products package for Pakistan by World Trade Organisation (WTO) is still to be enacting by 27-state European Parliament.
A long-awaited decision regarding the exports of the Pakistani Textiles products to the European Union (EU) is now going to be tabled in the EU parliament in few days for final approval.
It is hoped the impact of this development would start surfacing from fourth quarter of fiscal year 2012, he added.
Pakistan would be able to export 75 items including textile, leather and ethanol. Within the span of two years, Pakistan is expected to benefit Euros 900 million worth of exports.
However, the main items of the textiles sector bedware, ready-made garments and cotton fabrics, which holds 38 percent, 20 percent and 12 percent respective share in textile exports to the EU are not included in the concession package.
After the concession from the EU, the sub-textile sectors of dishcloth, duster, knitted tracksuits-making units, weaving industry, towel, gloves and socks-making units will benefit.
The cotton prices in the country came down after the announcement of surplus estimates by the USDA for global cotton crop in 2012.
It adversely affects Pakistan’s textile exports besides energy and gas cuts for textile sector in the country would also restrict the volumetric export, Ahmad added.
Besides, falling textile demand from the Western economies and relocation of textile units to Bangladesh are also among the factors, he added.
Despite continued gas curtailment and shrinking margins in value added segment, raw cotton and its immediate product ‘cotton yarn’ exports would pick up pace in the remaining 2012 period on the back of seasonal demand by various countries.
According to the International Cotton Advisory Committee (ICAC) global cotton trade is projected up by 6.7 percent to 8.61 million tonnes in 2011-12, fuelled by larger production and consumption, he added.
Nishat Textile Mills (NML) would take the maximum advantage of this concession in textiles exports to the EU as the company exports textiles products including apparels, home textiles and some grey cloths’ kinds to the EU.
Nishat Chunian Limited (NCL) will be relatively less benefited as the company exports only some kinds of grey cloth to the EU.
During FY11, NML exported Rs 13.3 billion worth of products to the EU (27.5 percent of its total sales), while NCL exported Rs 2.4 billion worth of textiles products to the EU (11.6 percent of its total sales).
Ahmad Rashid Ahmad
February 12th, 2012, 11:19 PM
Pakistan textiles lifted by WTO trade waiver
It makes a change, but Pakistani textiles boss Asghar Hussain is pleased. A year ago, recession, power cuts and poor security forced him to sack most of his workers.
Now he’s hoping for a major improvement in garment sales after the World Trade Organization approved unprecedented waivers allowing 75 Pakistani products duty free access to markets in Europe for two years.
The European Union is Pakistan’s largest trading partner, receiving nearly 30 percent of its exports — worth almost 3 billion euros ($3.9 billion).
“It means we should expect good gains… as Europe is a huge market for Pakistani readymade garments,” said Hussain.
The signs are so good that Hussain has re-hired some workers, bringing his total staff to 50.
It is a fraction of the number he employed before devastating floods in 2010, but he expresses hope it could be a pointer to rosier times ahead.
The WTO passed the waivers as an unprecedented concession in order to help Pakistan recover from the floods, yet in 2011, the business climate had already started to improve.
Cotton prices rose to an all-time high of 229.67 cents a pound in March, and although they have since retreated to a modest 87 cents a pound, it is good news for Hussain, who says he exports 25 percent of his goods to Britain and Germany.
There was also a fall in Islamist and sectarian violence in the second half of 2011 and power cuts also diminished owing to priorities being given to industry.
“The situation isn’t ideal. Cotton prices have decreased again, but power supply is better and industrial peace is there,” said Hussain.
Textiles dominate Pakistan’s trade with the EU, accounting for more than 70 percent of its exports to the trading bloc.
The products chosen for the waiver, which needs to ratified at the WTO general council meeting on Tuesday and Wednesday, would amount to around 900 million euros in import value, about 27 percent of EU imports from Pakistan.
Pakistani textiles are currently hit with a 7.19 percent import duty in the European Union. If approved, the waiver will apply until end-2013.
“Such concessions will bring life to our dying industry,” said Shehzad Salim, Chairmen of Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA), without providing precise figures.
“Our value-added textile industry’s exports have suffered a lot because of electricity and gas shortages, devaluation of rupee and many other factors. The EU’s package is promising and seems a breather for a choked economy.”
Mirza Ikhtiar Baig, textiles advisor to the prime minister, revised down an initial estimate that the EU package may increase exports by 400 million euros, agreeing with independent analysts who forecast a slightly lower figure.
Most believe the waiver will equate to a 0.7 percent increase in Pakistan’s overall exports and a 1.5 percent increase in its textile exports.
“This package would increase Pakistan’s exports by $175 million a year,” said Furqan Punjani of Equity Research, a market research firm.
The package includes over 30 products of non-value added textiles — items such as gray cloth, cotton yarn and fabric — 23 of textile garments and the rest made up of home textiles, value-added leather, footwear, raw leather and ethanol and vegetables.
“We estimate an increase of 0.7 percent in Pakistan’s overall $25 billion exports for the year while it would contribute 1.26 percent to our $13.8 billion textile exports,” said Baig.
“The increase is a good positive for our economy, yet it should not be called significant given the fact that a ceiling has been imposed on our 15 quality products.”
A.B. Shahid, an independent analyst, was more cautious.
“The WTO waiver is a positive development, yet it is too little to handle the increasing negatives the economy is accumulating,” he told AFP.
That caution is something that skilled garment worker Mohammad Wahid understands only too well. When he was sacked two years ago, he struggled to feed his family of five until he was rehired 10 months later.
“Life is better now,” he said.
“Concessions in Europe are good, yet no-one knows how long this job lasts. In Pakistan, the feeling of insecurity never bites. It stings fatally.”
Ahmad Rashid Ahmad
August 27th, 2012, 07:47 PM
Analysis: The textile sector is not indispensible for the economy
The textile sector employs many, exports a lot, but pays little in taxes and impedes growth of other sectors.
Pakistan’s textile industry is not a child anymore. It should stop acting like one.
There is no question that the textile industry is Pakistan’s single largest industry. But the textile lobby has a penchant for exaggerating just how big it is. According to the 2012 Economic Survey of Pakistan, issued by the finance ministry, the textile industry itself constituted about 4% of the total size of the economy. If one were to charitably add the related cotton farming sector, that number goes up to only 5.6% of gross domestic product.
And while the government does not break down tax revenues by sector, estimates based on companies listed on the Karachi Stock Exchange (an admittedly imperfect measure) suggest that the share of taxes paid by the sector amount to less than 5% of the total revenues collected by the government.
There is no question that the textile industry is important, but it is not indispensible.
The problem with the textile sector – easily the single most powerful lobby in the country – is that it has grown complacent owing to giant walls of protection erected by the government.
The government provides cotton farmers massive subsidies on everything from fertiliser to water so that cotton prices in Pakistan stay lower than the global average. It provides the larger textile companies with gas so that they can produce electricity more cheaply, even at the expense of causing 12-hour power outages for the rest of the country. They are exempted from income taxes on their export revenues, with only a nominal 1% sales tax levied on revenues (other exporters also have this facility). Their machinery imports are exempted from import duties. And until recently, the government even paid most of the interest on the loans taken on by textile companies.
So what exactly does the Pakistani economy get in return?
The textile industry is correct when it says that it is one of the country’s biggest employers. The 2011 Pakistan Labour Force Survey estimates that the sector employs just over 1.5 million Pakistanis, a little under 2.9% of the total workforce. And it does provide for about half the country’s export earnings.
But is all of this enough? More to the point, is it even sustainable? Any reasonable analysis of the textile sector suggests that the answer to both of those questions is no.
The Express Tribune has compiled a special report on the state of the textile sector, the pressures it faces and the opportunities before it. Our nationwide team of reporters has spent the last month compiling data to put together this picture of an important Pakistani industry, and the picture we have gotten is not pretty.
The textile industry has essentially refused to invest in value-addition. The share of value-added garments as a percentage of total textile exports has remained constant for the last decade, suggesting that there has been no progress in trying to make Pakistan’s industry more globally competitive.
Some of the largest textile companies in Pakistan are willing to recognise that investments in productivity-enhancing technologies is a worthwhile endeavour. But the textile lobby insists on blaming the government for absolutely everything that goes wrong, insisting that the industry itself is blameless.
It is impossible to talk to any textile exporter or lobbyist (the two are often interchangeable) without hearing the exact same talking points: that the government should start paying their interest rates again and provide them with gas so that they can keep running their highly inefficient captive power plants, even while starving the rest of the grid of cheap fuel, forcing the government to fork over massive subsidies, which run up the deficit that in turn causes high inflation and the high interest rates that they complain about in the first place.
This problem of brazen exploitation is worst in Punjab, where at one point, the government provided zero gas to the power sector – causing the province to effectively shut down – so that they could keep supplying the textile industry’s captive power plants.
This industry still has some benefits, but it has rapidly turned into a cancer that is feeding on the rest of the economy. If the Pakistani economy is to thrive and become globally competitive, the government needs to divert its resources away from granting privileges to this over-coddled sector and towards higher growth sectors.
For the sake of ordinary Pakistani families being crushed by high inflation and power outages, the government must stand up to the textile lobby.
Ahmad Rashid Ahmad
September 26th, 2012, 08:03 AM
Textile imports down 11% in 2 months of FY 2012-13
The textile imports into the country fell in July-August (2012-13) by 11.17 percent against the same period of last year.
The overall imports of textile group remained $374.341 million during first two months of current fiscal year against the imports of $421.433 million during the same period of previous year.
According the data of Pakistan Bureau of Statistics, the imports of synthetic fibre shrank by 28.51 percent during the period under review.
Synthetic fibre imports into the country were recorded at $62.729 million in July-August (2012-13) against imports of $87.751 million during July-August (2011-12).
Imports of raw cotton increased by 22.24 percent by growing from $92.254 million to $112.773 million whereas the imports of worn clothing increased by 23.79 percent by going up from $20.293 million to $25.121 million.
The imports of synthetic and artificial silk yarn were recorded at $84.747 million during the period under review against the imports of $111.859 million in last year posting a negative growth of 24.24 percent.
Similarly the imports of all other textile items registered negative growth of 18.58 percent decreasing from imports of $109.276 million to $88.971 million.
Meanwhile, during the month of August 2012-13, the textile imports into the country witnessed decrease of 1.85 percent and 10.78 percent when compared to the imports of August 2011 and July 2012, respectively.
Textile imports in August 2012 stood at $176.509 million against the imports of $179.831 million and $197.832 million in August 2011 and July 2012, respectively. It is pertinent to mention here that overall imports into the country during the period under review witnessed decrease of 1.99 percent. The imports into the country were recorded at $7.346 billion in 2012-13 against the imports of $7.495 billion, the PBS data revealed.
December 26th, 2012, 07:48 PM
Garment manufacturer brings back investment from Bangladesh
EU concessions encourage Tauseef Enterprises to reinvest in Pakistan.
By Imran RanaPublished: December 26, 2012 Ali says Pakistan will qualify for the GSP Plus in 2014 and after winning the concessions there will be no need to invest in Bangladesh or any other country.
FAISALABAD: Tauseef Enterprises has again lived up to expectations by taking timely business decisions to make windfall gains.
After investing in Bangladesh about three years ago to reap the benefits of duty-free access to the European Union, the company – a big garment manufacturer – has started taking out its investment and is reinvesting here to earn dividends of EU concessions, this time for Pakistan as well.
The EU has allowed export of 75 selected products, mostly textile, to its market without any duty in an effort to offset the impact of 2010 floods in Pakistan. The 27-nation bloc has also eased criteria for winning unlimited duty-free access under the Generalised Scheme of Preferences (GSP) Plus.
These two concessions have prompted Tauseef Enterprises to consider whether it should keep its investment in Bangladesh or bring back the money.
Tauseef Enterprises Chief Executive Officer Chaudhry Salamat Ali, who is running two textile mills in Bangladesh, has already withdrawn Rs200 million out of more than Rs300 million, besides stopping fresh investment.
In the past three years of investment in Bangladesh, Ali’s business made exceptional profits. Now the company is withdrawing the original capital and its units there will continue operating with the help of profits earned and reinvested during these years.
Talking to The Express Tribune, Ali said Pakistan would qualify for the GSP Plus in 2014 and after winning the concessions there would be no need to invest in Bangladesh or any other country.
At the time when he poured money into Bangladesh, the key edge the country had was free access to the EU markets. Now the same facility is enjoyed in Pakistan and there is no need to keep investment abroad.
Declaring Pakistan a good place for investment, Ali said industrialists of Faisalabad realised this fact after investing abroad, particularly in Bangladesh. Cheap labour and raw material provided an edge to the industry in Pakistan, but problems were still there that needed to be addressed, he said, referring to acute energy shortages.
He termed energy crisis the biggest bottleneck despite Pakistan having great potential for doing business. He suggested that the crisis could be overcome by utilising alternative energy resources.
Ali’s company is also planning to invest in energy generation in an attempt to end its dependence on national grid. “We can no more rely on the government because it has consistently failed to tackle energy issues,” he said.
The company will install a 50-kilowatt solar energy plant and if the experiment goes well it will upgrade the plant. “Industrialists should also focus on alternative energy resources, instead of censuring the government,” he said.
Published in The Express Tribune, December 26th, 2012.
December 26th, 2012, 07:48 PM
If Pakistani politicans become sincere and resolve energy crisis for the sack of people then I am sure a lot more investment will come back to Faislabad :)
December 26th, 2012, 08:01 PM
^^ Thanks for sharing.
January 6th, 2013, 01:32 PM
Textile exports: Smart planning helps Kay & Emms double sales
While much of the rest of the textile industry continue to whine and complain about the government taking away its privileges, Kay & Emms, a medium-sized garment manufacturer in Faisalabad, has managed to more than double its sales over the past three years, largely as a result of smarter business planning.
“Before executing any plans to expand our business, we prefer to do extensive market analysis,” said Khurram Tariq, CEO of Kay & Emms, in an interview with The Express Tribune. “About 80% of our sales are in the United State, so market analysis can be expensive, but we still hire international consultants because it saves us from losses and reduces the risk of introducing a new product or brand.”
This bias towards analytics and planning appears to come from Tariq’s own educational background. He is a medical doctor by training, and the scientific education he has received appears to be translating into his business plans.
And the company’s growth appears to have also had an organic quality to it: the family initially made its money when Tariq’s father, Sharif Tariq (still the chairman of the company) started a yarn trading business in Faisalabad’s famous yarn market. He used that money to get his son an education. In 1990, Khurram and his brothers Moazzam and Muneeb started Kay & Emms, the garment manufacturing firm that is now growing rapidly. Khurram serves as CEO, Moazzam is the operations manager and Muneeb, based in the US, handles marketing.
After more than two decades of being a manufacturer for foreign brands, Kay & Emms introduced its own brand of clothing – Clear Rock – in the United States in 2012. Over the next year, it plans to expand the Clear Rock brand not just within the United States but also in its remaining markets in the European Union
And while others in the textile industry have struggled to meet their strict order deadlines from European and North American retailers, Kay & Emms appears to have had no such trouble, largely by anticipating the needs of their customers.
“We are expanding our manufacturing capacity every year,” said Tariq. “And this year we installed the embroidery machinery because this has a great demand in international markets.”
The company’s revenues hit Rs1.4 billion in the financial year ending June 30, 2012, up an impressive 29.6% compared to the same period in the previous year. Gross revenues for Kay & Emms have more than doubled since financial year 2009, a feat that has not be matched by most of its rivals in the textile business. And despite that rapid growth, the company is targeting growth of between 25% and 35% in its revenues for the next few years.
Kay & Emms also seems to improving is manufacturing efficiency every year. “We increase our manufacturing capacity every year by about 25%, but our labour force increases by an average of about 20% a year,” said Tariq, implying a significant gain every year in labour productivity, a factor that many textile players in Pakistan have traditionally not paid attention to.
That increase in labour productivity in turn has allowed the company to hire relatively high quality talent. On its website, Kay & Emms boasts of having hired MBAs and other well-qualified individuals to manage its operations, which appears to have enhanced the company’s ability to meet its demanding clients’ deadlines. “The customer wants timely delivery and we are providing,” said Tariq.
And what about the energy crisis, which has crippled most of their rivals? Tariq has a relatively straightforward answer to that: “There is no doubt that the energy crisis has had an adverse impact, but better planning can minimise those damages. Instead of just criticising the government, there is a need to resolve [the energy crisis] as a business problem. We cannot just sit idle and let the energy crisis ruin our business.”
Published in The Express Tribune, January 5th, 2013.
Their website with many relevant pics
January 25th, 2013, 07:28 AM
February 2nd, 2013, 04:17 PM
March 9th, 2013, 12:26 PM
April 20th, 2013, 11:05 AM
April 21st, 2013, 10:16 AM
May 2nd, 2013, 09:23 AM
FAISALABAD : Image Garments, based in Faisalabad, has planned to ramp up production in the face of growing demand from international store chains and other buyers as they switch to developing countries like Pakistan after labour becomes expensive in China.
As the lifestyle improves in China – the second largest economy of the world – so do the wages of labourers, making the cost of stitching, cutting and spinning unsustainable. For these works, garment buyers are searching for new markets with Pakistan and Bangladesh becoming most preferable destinations.
“Image Garments has decided to cash in on the opportunity to capture international markets with buyers shifting from China to other regional competitors,” said Qamar Aftab, Chief Executive Officer of Image Garments, while talking to The Express Tribune.
The company, which makes international brands like Polo (USA), Slazenger (United Kingdom) and Donnay (Belgium), will invest Rs200 million in expanding its production capacity to cater to the growing demand.
Its products include Polo shirts, Sweat shirts, hooded Sweat shirts, T-shirts and undergarments. It also supplies uniforms to various international companies.
The company imports fabrics from China for getting better finishing quality of international standards.
“Major European and American importers, wholesalers and retail chains are our customers,” said Aftab. “We have a hi-tech production facility which is flexible enough to meet specific apparel needs. We have the required knowledge and capability to do a wide variety of embellishments, embroideries, appliques, printing and washes.”
With the production boost, the management is targeting to step up sales by at least 50% on the back of aggressive marketing.
Image Garments is not taking any bank loans for expansion as it has sufficient capital provided by a significant increase in sales. Last year, it made exports worth $10 million.
However, its cost of production is going up because of reliance on power generators to cope with frequent and prolonged disruption in energy supply.
Image Garments also cares for its employees and it not only provides financial incentives to them, but also organises training sessions.
“We are providing all facilities to our employees, like social security, old-age benefits, a handsome salary, bonus and other incentives. With rising sales, we increase the number of our workers every year,” said Aftab.
Saying that there was scarcity of trained workers, he stressed that the company’s employees were required to undergo three months of training to equip themselves with skills that would ensure production of quality products.
Source : http://tribune.com.pk/story/543234/garment-demand-international-retail-chains-switch-focus-to-pakistan/