Lahore - APTMA Chairman S M Tanveer has said as many as 100 textile mills are vulnerable to viability issue and seriously considering of closing down operations sooner rather than later.
He said some 20 textile mills have already closed down operations in the country due to loss of competitiveness oozing out of real exchange appreciation and high cost of doing business. According to him, majority of the textile mills are considering slashing down work force by reducing mills’ operations to two shifts a day.
He said the APTMA has been agitating against declining trend in textiles and clothing exports in the recent past, submitting to the government for an early intervention to arrest the fall. He said a sudden ‘appreciation’ in rupee value has hit hard the textile industry viability across the board. In addition, he said, competing with the subsidy-laden regional competitors has put the upside down the textile industry in Pakistan. S M Tanveer said the IMF has also stated in its “six months review under the extended arrangement and modification of performance criteria” that the Pak rupee has gained 1.2 per cent over the last quarter against the dollar and the real effective exchange rate has appreciated 10.6 percent since the onset of the program. The lack of downward exchange rate flexibility and a high inflation differential relative to trading partners have caused a further loss of Pakistan’s export competitiveness in world markets, the report added. Chairman APTMA has urged the economic managers of the government to restore viability of the textile industry by taking appropriate steps on emergency basis. Any further delay, he warned, may lead to closure of further mills that will be translated into supply side losses, retrenchment of the textile work force and a heavy decline in exports.