Pakistan wants to take its textile exports to $150 billion by 2025. The Vision 2025 paper lists out developing human and social capital, achieving sustainable indigenous and inclusive growth, modernisation of public sector, energy, water and food security, public sector-led growth and entrepreneurship, developing a competitive knowledge base through value addition, modernisation of transport infrastructure and greater regional connectivity as it focus area.
Emphasis has been given to entrepreneurship development and private sector-led growth in the program. A bigger role has been envisaged for private sector organisations and entrepreneurs to contribute more effectively to the growth of the economy and development of the country. Technology constraint has emerged as one of the main hurdles for Pakistan. The government has announced many incentives for the textile sector in the recently announced federal budget including technology up-gradation.
Pakistan is in dire need of enhancing exports to provide some cushion to its sagging economy and to ensure sustainable economic growth. The textile industry is the most important manufacturing sector of Pakistan and has the longest production chain, with inherent potential for value addition at each stage of processing, from cotton to ginning, spinning, fabric, processing, made-ups and garments. The overall sector contributes nearly one-fourth of industrial value-added, consumes more than 40 per cent of banking credit to manufacturing sector and accounts for 8 per cent of GDP.
However, despite being the fourth largest producer and the third largest consumer of cotton globally, Pakistan’s comparative advantage is largely pre-empted by low value-added exports.