LAHORE: Pakistan’s textile value-chain production is slowing down in the apparel sector. This is worrying. All accessories for apparel, such as buttons, zips, labels, or monograms, must be imported by Pakistan. To ensure compliance, even dyes have to be imported
Many problems faced the apparel industry when the supply chain was disrupted, first during the Covid-19 pandemic, then after the Russia-Ukraine conflict.
Due to delays in the delivery of buttons or zippers, many consignments were unable to be packed.
Apparel exports count for almost 45 percent of Pakistan’s total textile exports. While the value chain is nearly complete for the spinning industry, it is very limited in apparel.
Most of these industries are made in India and Bangladesh, which is also a competitor to India, Vietnam and Vietnam. India produces high quality dyes, which are not only used locally but also exported.
Many Pakistani brands are made from Bangladesh. They can save money on foreign exchange and avoid the hassle of keeping stocks that could affect their finances. According to apparel exporters, these accessories are valued at 25% of the cost of production.
Exporters of knitwear and garments are not favored by the rupee’s depreciation. However, the price of imported accessories rises with the rupee’s decline. They also have to take out a lot of resources in order to stock these accessories.
If the government had assisted accessory makers in setting up these units, apparel manufacturers would have been protected from higher costs due depreciation as well as the keeping of large stocks.
Exports of garments and knitwear from Pakistan are key to the future of textile exports. They have grown at an impressive pace over the past few years.
Planners should come up with a strategy that encourages the production of buttons and zips, at minimum so that apparel exporters have more confidence.
Another concern that buyers need to pay attention to is the fact that major apparel companies at a recent meeting held in Dubai warned all garment exporters they would like their vendors fully compliant with social and labor issues.
Even fully compliant vendors could be prevented from outsourcing to other units. This is because units that aren’t fully compliant can’t be asked to perform orders or process fabrics.
This would have an impact on smaller units that are compliant on labour issues but lack water treatment plants.
To construct a water treatment plant at least close to textile clusters, the state must be on a war footing. In addition to imposing usage fees to cover the ongoing cost for all industries, the state must also work on a war footing. After that date, the brands would cease to be suppliers to these brands.
The issue of environmental compliance is a pressing one. The Bangladeshi garment industry, in collaboration with a German NGO, declared its mills eco-friendly after an audit.
Over 170 mills are currently certified to use sustainable practices. They have also received more orders because of this certification.
Over 500 units exporting to the United States are working on improving their systems in order to obtain certification.
To be certified as sustainable, apparel exporters in Pakistan must work together with the same German NGO.
The apparel exporters are also worried about rupee volatility. They don’t know how much the dollar rate will be for their export earnings.