The textile industry is one of the largest industries in Pakistan and is a major contributor to the country’s economy. It accounts for 60% of the country’s exports and provides employment to millions of people. However, the industry is currently facing a severe financial crisis, which could lead to defaults and bankruptcies.
In 2023, Pakistan’s textile industry is facing major challenges, which are causing a steep decline, according to the latest reports. One of the main factors affecting the industry is the high cost of energy, as textile operations are highly dependent on electricity and natural gas. Rising energy costs make it difficult for manufacturers to remain competitive, resulting in reduced profitability and increased production costs.
Another challenge is the industry’s slow adoption of new technologies and processes, making it difficult for Pakistan’s textile industry to compete with other countries.
Aptma, the textile lobby, has noted that domestic cotton production has remained below 5 million bales due to flooding and heavy rains. Additionally, the industry has faced reduced demand due to the global economic downturn and a decrease in consumer demand for textiles, resulting in reduced production and income.
Inadequate government policies and support have also contributed to the decline of the industry. There has been little investment in infrastructure, research, and development, leading to a decrease in productivity and competitiveness.
The textile lobby has outlined the key issues plaguing the industry, including textile factories operating at less than 50% capacity, and around 10 million people associated with the industry losing their jobs, costing the country more than $10 billion in annual export earnings.
Pakistan’s textile industry is facing a serious financial crisis that could have a major impact on the country’s economy. However, there are some possible solutions that can help mitigate the crisis and support the growth of the industry. It is critical that government and industry stakeholders work together to find sustainable solutions to the industry’s challenges.
