Textile exports of the country registered a nominal increase of only one percent in the current calendar year and netted $9.1 billion as compared to $9 billion during the same period of last year, it is learnt. Official sources revealed to Business Recorder that textile exports to the European Union (EU) registered an increase of 19 percent during the first nine months of the current calendar year and remained at $3.98 billion as compared to $3.3 billion during the same period of last year.
One of the main reasons behind the increase in exports to EU were the GSP Plus status as Pakistani products have an edge of 9.6 percent over other countries, officials maintained. Textile exports to countries other than EU were $5.27 billion during this period as compared to $5.6 billion during the same period of last year, registering a decline of 9 percent, revealed officials, adding that Pakistan textile products in other countries are no longer competitive due to the increasing cost of doing business. Like Pakistan, Bangladesh is already enjoying the same preferences in the EU market, while India, China and other competitors are giving subsidies to their exports, sources added. According to the officials, in case, Pakistan had not secured the GSP Plus status, we would have witnessed about $1.1 billion decline in exports in the current year.
The country's overall textile exports increased by 3.95 percent in the last fiscal year mainly due to the increase in exports to the EU after getting the GSP plus status. Textile exports surged to $13.74 billion during previous financial year 2013-2014 as compared to $13.05 billion of the preceding year (July 2012 to June 2013).
According to officials, there was a significant increase in post January 2014 orders from EU after getting preferential status; however shortage of utilities particularly power and gas remains main impediments in increasing output. Representatives from textile sector said that Pakistan's textile exports have not so far picked up momentum despite grant of GSP Plus status by the EU. Textile exports to EU were expected to rise by $1billion a year after getting the GSP Plus status. However there are several challenges, including fluctuations in the prices of raw materials, energy shortages and stiff competition that can mar the benefits of the scheme, they added.
Textile Industry ministry officials said the government is working to prepare five-year plan to provide incentives mainly to the value-added textile sectors. Under the new proposed textile policy (2014-19) value-added textile sector would be incentivized. According to the policy, textile exports would be increased to $26 billion in next five years, besides creating jobs opportunities.
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