Pakistan's textile exports decline 3.1% in February

• Downward trend mainly due to the downbeat value-added sector that is key to drive growth of exports.
  
• Topline Research says textile exports declined mainly due to an 11.6% decline in volumetric sales.
• Exports declined 6.7% in dollar terms and 7.3% in rupee terms due to the low number of working days in February.

ISLAMABAD: In a worrying sign, Pakistan’s textile exports fell by 3.1% on a year-on-year basis and 6.8% on a month-on-month basis landing at $1.2 billion in February of fiscal year 2020-21.

The News, citing the Pakistan Bureau of Statistics (PBS), said that exports of knitwear and bedwear declined by 13% and 1.2% year-on-year, respectively. The exports had fallen from 10.3% and 7.3% on a month-on-month basis.

The downward trend was mainly due to the downbeat value-added sector that is a key driver of export growth. However, exports of basic textiles increased.

Read more: PM Imran Khan okays cross-border yarn import

In February, basic textiles exports — cotton yarn, cotton cloth, non-cotton yarn, and raw cotton — increased 13% month-on-month. However, the value-added sector and other textiles witnessed a decline of 11% and 10% respectively.

Textile exports declined mainly due to an 11.6% decline in volumetric sales, said Topline Research.

The firm said that the exports declined 6.7% in dollar terms and 7.3% in rupee terms due to the low number of working days in February.

“In last six years, February textile exports have fallen in range of 1-10%– except for February 2020,” the brokerage said in a flash note.

Within the basic segment, cotton yarn increased 40% month-on-month to $120 million thanks to a 35% rise in exported quantity.

Read more: Pakistan's current account deficit declines to $229m in January

Within the value-added segment, knitwear, bedwear, towel and ready-made declined 10%, 7%, 11% and 15% month-on-month, respectively.

In the first eight months of the current fiscal year, textile exports rose 6.6% to $10 billion, up 11% in rupee terms, as orders from India and Bangladesh were diverted to Pakistan.

The brokerage firm also stated that Pakistan has benefitted from the US-China trade war as well.

Exports had recovered to the pre-COVID monthly level of $2 billion in September, October and November and the recovery were due to low value-added apparels and home textiles.

Exporters have been warning of falling exports due to the increase in yarn prices amid a cotton shortage.