Pakistan's apparel exports to the European Union surged by 25.18 per cent in value and 26.17 per cent in volume during January to June 2014. During this period, Pakistan posted the highest growth in apparel exports to the EU compared with all other major exporters. However, the per kg value of garments and knitwear remained the lowest compared to its major competitors.
Pakistani exporters have been facing stiff competition from India. Indian exporters lowered their per unit rates in 2014 because the Indian government provided them additional rebates and incentives after Pakistan was granted GSP Plus status by the EU. Another problem Pakistan has is that local manufactures use only cotton based products while the global demand is predominantly for apparel made from blended fabrics. That is a key reason for low value addition in Pakistan’s apparel exports.
The ratio of cotton to manmade fiber use in Pakistan is 75:25 while the world ratio is the reverse. The textile industry in Pakistan feels it’s kept out of blended textiles because of the huge protection that the government provides to polyester fiber plants in the country. The conclusion is that value addition in Pakistan would continue to suffer until the domestic industry is provided level playing field in manmade fiber as provided in cotton. <br/>