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Energy crisis puts cotton export orders in jeopardy

The textile exports of Pakistan are feared to be well short of target for FY13 mainly due to energy crisis, while Indian exports have started showing significant increase, said a ginning industry representative on Monday.

Continued outages of electricity and non-supply of gas to export-oriented textile units have resulted in failure of Pakistani textile mills in fulfilling and timely delivery of yarn export orders. Consequently, China, Bangladesh and other countries have started importing yarn from India, said Ihsanul Haq, ex-executive member of the Pakistan Cotton Ginners Association. He added that during last two months the Indian textile mills have received record cotton yarn export orders.

As per the initial estimates, he said, the cotton exports target of Pakistan set for the current financial year at $16 billion seems unachievable and it’s apprehended that shortfall in cotton exports may reach $3.5 billion below the target.

On the other hand, he said that according to the statistics issued by the Indian Director General Foreign Trade during November 2012 registration for cotton yarn export touched 100 million kg, which is highest in Indian history, 32 percent higher than November 2011 and 5 percent higher than October 2012. It’s being expected that there are bright chances for Indian exporters to continuing to get similar copious cotton yarn export orders.

Ihsanul Haq further added that Indian government is making all-out efforts to increase its cotton exports by relaxing 30-day period for export of lint to Pakistan through land route and lifting of regulatory duty for import of Indian cotton yarn by Turkey after mutual trade negotiations.

On the other hand, textile exporters are facing multiple problems in Pakistan. The containers carrying export items are being forcibly confiscated and used for blocking roads. He informed that during Trade Fair 2012 in Germany, many buyers refrained from giving cotton yarn import orders to Pakistani textile mills merely because of the apprehensions that due to electricity and gas outages Pakistani exporters will not deliver orders on time.

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