Value-added textile exporters have warned the government that the decline in exports will continue to persist despite a recent reduction in natural gas prices for different industries.”I don’t think textile exports will show any significant improvement in coming months despite a 33% reduction in gas price for export-oriented industries,” commented M Babar Khan, CEO of Multinational Export Bureau, a Karachi-based textile company.After posting a continuous decline, textile exports showed a tiny rise in October 2016. Pakistan’s textile shipments increased to $1.053 billion in October 2016, up by just 0.59% compared with $1.047 billion in October 2015, according to latest available data of the Pakistan Bureau of Statistics.Khan cautioned that the small increase in October export numbers did not mean that textile exports had started recovering. “Fundamentals are still the same for the industry and the slight increase in numbers shows the country may have received additional support this fall,” he added.However, Khan, whose company’s gas consumption makes up around 70% of the total monthly energy bill, acknowledged that the gas price reduction announced at the end of November would have a positive impact on its earnings.The federal government slashed the gas price for industrial consumers to Rs500 or $4.76 per million British thermal units (mmbtu) from Rs702 or $6.68 per mmbtu. For export-oriented industries, it cut the gas price to Rs400 or $3.80 per mmbtu from Rs600 or $5.71 per mmbtu.Textile exports account for more than 50% of total exports of Pakistan and any development related to the textile industry has a visible impact on the country’s overall exports.In the first four months (July to October) of fiscal year 2016-17, the export value of textile and clothing products stood at $4.082 billion, down 4.4% compared with $4.268 billion in the same period of previous year.
