Pakistan’s textile sector exports fell by 12 per cent in January 2023 in comparison to the same month of the previous year.

The country’s textile exports in the first seven months of fiscal year 2023 decreased by eight per cent. The decline in textile exports is concerning for the South Asian economy, which is already facing depleting foreign exchange reserves.

The textile sector, the single largest manufacturing sector of Pakistan, is confronted with numerous challenges. The worsening international economic situation primarily caused by the Ukraine crisis combined with floods in Pakistan has negatively impacted the already inefficient supply chains of the country. Flooding in dozens of districts of Pakistan has destroyed a wide swath of agricultural land.

While the industry requires 14 million bales of cotton, the country could only produce five million bales domestically.To meet this gap cotton needs to be imported. However forex issues in the economy have curtailed imports of cotton and other essential inputs for exports. The issue of raw material clearance from the ports remains unresolved owing to unavailability of forex and therefore mills are currently unable to obtain cash against documentation and are closing down owing to the shortage of raw materials.