The textile industry of the country way back in 1957 organized itself into what became the premier textile industry association of the country. 100% of the country’s textile exports and more than 50% of the country’s clothing exports emanate from Member Mills that constitute the All Pakistan Textile Mills Association. The textile industry is the mainstay of our economy. It contributes 8.5% to GDP and employs over 40% of the manufacturing sector workforce. Besides, the spinning industry being the sole consumer of cotton worth $5 billion, sustains the largest cash crop of the Pakistan.
FREE MARKET MECHANISM
Consequent to Pakistan’s accession to the World Trade Agreement, the country’s trade economy has been integrated with global trade that operates on the principle of free and open international trade. This is particularly true of Pakistan’s textiles and clothing sector, that was integrated into the upcoming $800 billion international textiles and clothing trade. The international textiles and clothing market is intensely competitive and operates on very low margins. Any sector or segment has to be competitive enough to survive in the quota-free world of international trade. With an eye on the characteristics and requirements of the WTO regime and to be able to compete therein, the spinning industry made $ 3.5 billion investments since the quota-regime of ATC was done away with in favour of open and free international trade.
It is noteworthy that the spinning industry operates in a free competitive environment especially with regards to the use and availability of raw materials. It procures 11.5 million bales domestically and 3 million bales from the international market on international terms. International procurement became necessary due to insufficient cotton crop since last ten years. It is therefore perfectly legitimate for it to expect the latitude to market and sell its products in the international market on the same principles. Having done so much to attain international competitiveness, the free market mechanism is at the heart of our interest and philosophy.
The free market regime enabled a significant resource transfer to the farm sector on account of cotton sale proceeds at international prices. As a result an additional Rs. 200 billion has been transferred to the agricultural sector this year. Textile exports have also increased in proportion and likely to maintain the momentum by increasing up to $ 4 billion this year.
In keeping with its resolute determination to realize its vision, the textile industry performed to improve its performance thereby enabling it to re-invest its earnings in productive assets. We visualize an export potential of $ 25 billion by 2014 with an investment of $ 2 billion per annum resulting in creation of job opportunities for a work force of one million and an increase in exports by $4 billion.