Pakistan Institute of Development Economics



Textiles Sector of Pakistan: The Challenge Beyond 2004

The world is presently looking forward to embrace the greatest moment of modern history of humankind, turn of the millennium. For Pakistan, however, the millennium celebrations are going to be accompanied by over half a century of missed opportunities and a serious challenge ahead. The focus of this study is Pakistan’s status as a ‘single commodity’ country and the life after 2004 in a post- Multifibre Arrangement (MFA) era. This work intends to use the hindsight to argue that MFA, a cat’s cradle of bilateral textile import quotas, was a blessing in disguise for the value added textiles sector of Pakistan. And the difficulties beyond 2004, when all the quotas have gone, should not be underestimated in a bipolar (NAFTA and the EU) and deregulated world economy . The analysis is carried out in four parts. Part I highlights the economic significance of Pakistan’s textiles industry by briefly analysing its contribution to different sectors of her economy. Part II presents the past, present and future scenario of international trade in Textiles and Clothing (T&C). The present situation of Pakistan’s textiles industry along with its foreign exchange generating performance in the past is assessed in Part III. Finally, Part IV analyses the prospects and challenges faced by the T&C sector of Pakistan.

Naheed Zia Khan