textile exports decline by 7% to $1.3 billion in November due to increased gas prices

Textile Exports in Pakistan Decline Amidst Rising Gas Prices

Pakistan’s textile exports experienced an 8% month-on-month and 7% year-on-year decline in November, according to official data from the Pakistan Bureau of Statistics (PBS). These exports, which make up more than half of the country’s total exports, dropped from $1.4 billion in October to $1.3 billion in November. In rupee terms, textile exports decreased by 7% month-on-month to Rs376 billion but saw a year-on-year increase of 19% due to currency depreciation against the dollar.

The decline in textile exports was primarily driven by a fall in value-added products such as towels, knitwear, bedwear, and readymade garments. These items collectively experienced a 6% month-on-month and 12% year-on-year decrease totaling $920 million. Basic textiles like cotton yarn, cotton cloth, and raw cotton also saw a 14% month-on-month decline to $243 million, albeit with a 20% year-on-year increase boosted by a significant jump in raw cotton exports.

The drop in textile exports has been attributed to the recent surge in gas prices, which has increased production costs and made it challenging for exporters to remain competitive in the global market. Industry analysts have expressed skepticism regarding the achievement of the government’s textile export target of $25 billion for the current fiscal year. They predict textile exports to reach $17 billion in the fiscal year ending in June 2024, a 3% increase from the previous year but still significantly below the target.

In November, Pakistan’s trade deficit narrowed by 10% month-on-month and 29% year-on-year as imports declined more than exports. Revised trade data revealed that the trade deficit stood at $1.966 billion in November, compared to $2.174 billion in October. Exports decreased by 4.35% month-on-month and 0.5% year-on-year to $2.573 billion, while imports experienced a 6.68% month-on-month and 14.5% year-on-year decrease to $4.539 billion.

The main exported commodities in November included knitwear, rice, readymade garments, bedwear, and cotton cloth. Conversely, the main imported commodities consisted of petroleum crude, petroleum products, liquefied natural gas, palm oil, and iron and steel.