Overview
- Citing PBS trade data released July 16, the Pakistan Textile Council wrote to Prime Minister Shehbaz Sharif to demand immediate policy action after annual export growth stalled and June shipments plunged.
- Pakistan’s textile and clothing exports were essentially flat in FY2025-26 at $17.93 billion and exports fell sharply in June 2026, down about 16.7% year-on-year and 23% month-on-month.
- The PTC says three structural problems explain the decline: rising production costs driven by higher wages and employer levies, industrial electricity tariffs that embed cross-subsidies, and a severe domestic cotton shortfall.
- The council asked the government to reduce employer EOBI contributions to 2% without cutting worker benefits, order NEPRA to realign industrial tariffs on a revenue-neutral cost-of-service basis, immediately operationalise the budgeted Export Refinance Scheme, and launch a national cotton recovery plan.
- If reforms are not implemented, exporters warn of deeper job losses, higher reliance on costly imports for raw cotton, weaker foreign earnings, and a loss of ground to lower-cost regional rivals such as Bangladesh, India and Vietnam.