Pakistan’s readymade garment manufacturers have urged the government to address all issues of the value-added textile sector immediately, as the continued drop in exports may widen further due to the Vietnam-EU free trade agreement, a massive decline in cotton production and a high import duty on yarn.

Pakistan’s export market has already shrunk due to high energy costs and discriminating import duties on industry raw materials. Exports of textiles and clothing have been declining sharply during the last six months along with low cotton yield.

The country’s garment makers want a reduction in all input costs. The textile sector is burdened with multiple taxes with high cost of inputs, tariffs of gas, electricity, raw materials, and is further harassed due to short supply of all these most essential utilities. Pakistan is facing almost a 35 per cent shortfall in cotton production as cotton bales arrivals have registered nine million bales against the set target of 14 million bales. Despite the huge shortfall of cotton, there is a 10 per cent regulatory duty on cotton yarn imports from India. It is feared that this will not only encourage cartelisation but will also squeeze raw material availability in the country.

Vietnam is emerging as a major threat for Pakistan’s textile sector.