The Trade Development Authority of Pakistan (TDAP) recently released the export figures for the month of May. These numbers paint a very grim picture for the largest industrial and employment generating sector of Pakistan and for the economy as a whole.
For the 11 months of the current fiscal year (Jul-May 2009), the textile sectors’ exports decreased by US$ 931 million, a fall of 9.6% compared to the same period last year. Almost all the sub-sectors are in red now especially the made-up sectors i.e. the bedlinen and the garments, which declined by US$ 184 million (10%) and US$ 331 million (11%) respectively. Only two sub-sectors i.e. towels and raw cotton, are showing a marginal increase. Towel exports increased by US$ 16 million (3%) while raw cotton exports surged by US$ 18 million (28%) during the 11 months of current fiscal year. It is worthwhile to mention here that increase in export of raw cotton is not a matter to rejoice because raw cotton is a commodity which sells very cheap and saps the down-stream value-added industry of valuable raw material.
Implications of the above figures can be felt far and wide in our economy. Couple of months back there was an article in the largest English daily which claimed that more than 300 textiles units have so far been closed rendering more than 700,000 people unemployed. But as there are no updated official figures on employment the figures would actually be much higher than what is claimed.
It is really alarming to know that despite this grim picture, the government has yet take single step to stem the faltering textile sector or the economy. The anticipated trade and textile policies are yet to be unveiled despite news that it is being given final touches for the past couple of months now. In any case, seeing the performance of this government in the past year, it can be claimed with certainty that these policies will not contain anything radical and so we should not be too optimistic. The ineffectiveness of this government can be gauged from the fact that the only demand put forward by the industry was a duty-free import status from USA and EU considering the tight financial conditions in Pakistan, even this demand has not been taken up properly despite Pakistan being a key ally in war against terror.
Only the government alone is not to be blamed for this whole scenario and the industry should be criticized here also. The industry is still running without any sense of direction or vision despite Pakistan being a cotton rich country. The industry has only managed survived on subsidies and doles handed down by the successive governments in the past. The industry has concentrated on taking only without giving anything back to Pakistan.
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