ISLAMABAD: Pakistan Textile Council (PTC) has said that the country’s value-added textile segment — comprising knitted apparel, woven apparel and home textiles — demonstrated resilience and growth, expanding by over three percent to USD 7.70 billion in 1H FY26, driven by strong performance in knitwear and non-knit apparel.
The textile sector remained the dominant contributor to Pakistan’s exports, with shipments reaching USD 9.19 billion, reflecting a one percent increase over FY25 and accounting for approximately 61 percent of total exports.
However, textile exports in December 2025 declined by nine percent year-on-year and five percent month-on-month.
Within textile and apparel exports, performance varied across product categories. Traditional textile exports (HS Chapters 50–60) continued to decline, falling from USD 1.65 billion in July–December FY25 to USD 1.49 billion in the corresponding period of FY26.
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In contrast, value-added textile exports (HS Chapters 61–63) increased from USD 7.46 billion to USD 7.70 billion, registering a growth of over three percent.
The growth in value-added exports was driven by knitwear (up 4.1 percent), non-knit apparel (up 4.9 percent) and other made-up articles (up 1.3 percent).
Export destinations showed mixed trends. The European Union remained Pakistan’s largest market, with exports rising to USD 3.67 billion, followed by the United States at USD 2.47 billion.
Exports to the United Kingdom stood at USD 892 million, reflecting a marginal decline, while shipments to Bangladesh and the UAE reached USD 311 million and USD 324 million, respectively. These trends reaffirm the EU’s position as Pakistan’s anchor market while highlighting risks arising from limited export diversification.
PTC data showed that textile exports to the United States have remained broadly stable over the past five years, peaking at USD 2.87 billion in 2021–22 before declining to USD 2.47 billion in 2025–26.
Exports to the United Kingdom also showed an overall stable trend, easing from USD 916 million in 2021–22 to USD 892 million in 2025–26.
In contrast, exports to the UAE increased steadily, rising from USD 167 million in 2021–22 to a five-year high of USD 324 million in 2025–26.
The PTC has recommended several policy interventions, including regionally competitive and predictable energy pricing for export-oriented industries, alignment of wage and overtime regulations with key competitor countries such as Bangladesh, reduction in taxes and zero-rating of inputs under the Export Facilitation Scheme, time-bound incremental export rebates for HS Chapters 61–63 linked to value addition and compliance with SDGs and ESG requirements, structural reforms to improve cotton quality and yield and reduce costs for the spinning and weaving sector (HS 50–60), strengthening of the EXIM Bank, enhancement of EFS and LTFF limits, and financing for innovation, renewable energy and green projects and the introduction of a five-year textile and apparel policy with legal cover and transparent monthly monitoring through published KPIs.
PTC Chairman Fawad Anwar said the 1H FY26 analysis highlighted a clear divergence within Pakistan’s textile and apparel export basket. Traditional textile exports — mainly yarns and fabrics — continued to decline during July–December FY26 due to a high cost of doing business, uncompetitive energy tariffs and tax frictions.
Exports under HS Chapters 50–60 fell to USD 1.49 billion from USD 1.65 billion a year earlier, underscoring structural stress in upstream segments.
“In contrast, Pakistan’s value-added textile segment has shown resilience and growth, reinforcing that the country’s export competitiveness increasingly lies in value addition rather than raw or semi-processed textiles,” he said.
He added that sustaining this momentum would require supportive government policies, including regionally competitive wage frameworks, predictable labour regulations and a tax regime comparable to peer exporters such as Bangladesh and Vietnam, enabling Pakistan to protect jobs, earn higher foreign exchange and move up the global textile value chain.
Copyright Business Recorder, 2026