Textile Exports decline 11 percent in July-2023

August 24, 2023

Pakistan Bureau of Statistics has reported that textile exports registered a drop of approximately 11% Year over Year (YoY) in July 2023, totaling around US$1.3 billion compared to the previous year’s US$1.5 billion during the same period. This decline can be primarily attributed to the global economic downturn, leading to a decrease in export orders, alongside a challenging domestic economic landscape.

Breaking down the different sectors, the exports of value-added textile goods, including Knitwear, Bedwear, Towels, and Ready-made garments, experienced a decline of about 13% YoY, reaching US$929 million in July 2023. Similarly, the exports of basic textiles like Raw Cotton, Cotton Yarn, and Cotton Cloth decreased by roughly 6% YoY, amounting to US$242 million. Additionally, other textile exports also saw a decline of approximately 9% YoY, reaching US$141 million in July 2023.

In terms of volume, overall textile exports witnessed a 15% YoY increase in July 2023 compared to the same period last year. This growth was primarily driven by a 33% increase in basic textile exports, followed by a 4% increase in value-added textile exports and a 15% increase in other textile exports. However, on a month-on-month (MoM) basis, export volumes declined by 11%. Value-added exports experienced an 11% MoM decrease, specifically with a 9% MoM decrease in volume and a 1% decrease in prices, resulting in an overall 11% MoM reduction, totaling US$929 million. This decline in value-added exports was mainly influenced by a sharp 114% MoM decrease in ready-made garment exports. Similarly, Knitwear and Bedwear recorded decreases of 7% and 10% MoM, respectively.

Basic textile exports encountered a 12% MoM decline in July 2023. The volume of exports decreased by 11%, coupled with a price decrease of 0.5%, resulting in a value of US$242 million, compared to US$258 million in May 2023. The decrease in basic textile exports was primarily driven by a 13% drop in cotton cloth exports, largely due to decreased volume. Moreover, cotton yarn exports experienced a decline of around 9% MoM.

Pakistan’s Textile exports have remained weak due to various challenges in the domestic environment and weakened global demand. Anticipations point towards a potential increase in textile exports in terms of volume due to a resurgence in demand from export regions.

However, the impact could be offset by declining product prices. Additionally, domestic textile players continue to face challenges such as high gas and electricity tariffs, delays in clearing essential inputs, and increased finance rates. Despite this, there is some optimism regarding cotton production for the upcoming year, which could provide relief to local textile manufacturers.