April 17, 2024
Economy

Pakistan Textile Sector Faces Risk Of 50% Closures: APTMA

The Pakistan textile industry faces risk of closure of 50 percent of companies due to soaring energy prices.

“Urgent government action is needed to address the crisis and safeguard the sector’s competitiveness, employment, and economic stability,” the All Pakistan Textiles Mills Association (APTMA) said.

APTMA added that escalating energy prices threaten survival of the sector with exports stagnating, leading Pakistan to lose market share to competitors like Bangladesh, India, and Vietnam.

“This crisis compounds the country’s weak macroeconomic outlook, characterised by high inflation and vulnerability, exacerbating unemployment and poverty while straining power sector revenue,” APTMA stated.

APTMA highlighted a decline in industrial power consumption, underscoring the need for urgent action to avert further declines.

The trade body warned of a vicious cycle of declining consumption and rising tariffs, exacerbated by cross subsidies to nonproductive sectors.

“The industry is no longer able to bear the burden of these subsidies, which hinder Pakistan’s manufacturing competitiveness,” the textile association observed.

APTMA requested a meeting with the government to discuss the industry’s precarious position and its broader economic implications.

“The outcome of this dialogue will be crucial in determining the government’s response to safeguarding the vital textile sector and averting widespread unemployment and social unrest,” APTMA noted.

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