California Apparel News

Now that quotas have disappeared, Pakistan is gearing up to compete with China on the apparel and textile front.

The country is holding its first Expo Pakistan in Karachi next month to showcase some 60 apparel and textile companies, as well as another 440 companies in industries ranging from information technology to surgical-instruments production.

Tariq Ikram, Pakistan’s minister of state and chairman of the Export Promotion Bureau, was at a Los Angeles Chamber of Commerce luncheon on Jan. 14 to promote the expo, set for Feb. 2–5.

He noted that the political and economic climate in Pakistan has improved dramatically in the last five years.

Five years ago, banks were charging customers 15 percent to 17 percent interest for business loans. Now an individual with a wellrun company can get a loan with a 3 percent to 4 percent interest rate.

In 1999, Pakistan’s foreign exchange reserves were only $500 million to $600 million. Now they are $12 billion, Ikram said. After the Sept. 11, 2001, terrorist attacks, the country’s debt was $38 billion. That has been reduced to $35 billion, he said.

“This turnaround that has taken place is enormous,” he said. “This is in spite of 9/11, SARS [severe acute respiratory syndrome], security issues and visa issues.”

He noted that Pakistan’s exports had been stuck for several years at about $8.5 billion, a number that seemed to be impossible to move. But that statistic grew to $12.3 billion in 2004 and is expected to hit $14 billion in 2005. Traditionally, the apparel and textile industry, the No. 1 manufacturing industry in Pakistan, makes up about 60 percent of that total.

The United States is Pakistan’s principal export market, in both apparel and other goods. Pakistan is the United States’ fourth-largest supplier of imported textiles and apparel. In apparel, Pakistan is the 15th-largest supplier.

For the 12 months ending Nov. 30, 2004, Pakistan exported $2.5 billion in textiles and apparel. In 2003, that number was $2.2 billion. Much of the country’s exports are cotton yarn, cotton fabric, cotton sheets, cotton socks, men’s cotton knit tops and bar mops.

Pakistan’s exports to the United States were aided by the Pakistan Emergency Economic Development and Trade Act, passed by the Bush administration in early 2002 to reward the Asian country for helping the United States drive the Taliban from Afghanistan and punish the Al Qaeda network, suspected of being behind the Sept. 11 attacks. The deal provided Pakistan with about $119 million in trade benefits, mostly in the form of reduced quotas. But that arrangement expired on Dec. 31, 2004.

That’s another reason for the push to grow the textile and apparel industries. In the last three years, Pakistani apparel and textile companies have invested $4 billion in new equipment, particularly in widewidth machines for the manufacture of bed linens.

“We have the strength of wide-width production,” Ikram said, noting that India has been slow in bringing in that kind of equipment. “Our use of water-jet and air-jet looms have brought us a lot of efficiency.”

Some of these companies will be present at Expo Pakistan. Ikram has been traveling the world to promote the expo. Since last November, he has been to Mexico, Argentina, Brazil, the United Kingdom, France, Germany, Saudi Arabia, Japan, China, the United Arab Emirates and the United States to tout the benefits of attending the event. He said that between 500 and 600 professionals are expected to show up.

“Our objective is to bring these 500 to 600 people from all over the world, show them what Pakistan is and let them absorb Pakistan,” Ikram said. “And hopefully they will be back.” —Deborah Belgum