Value addition cushions the blow, but structural weaknesses are reasserting themselves.
Pakistan’s textile and apparel exports delivered a mixed—and increasingly fragile—performance in the first five months of FY2025–26. According to the Pakistan Textile Council (PTC), exports reached $7.84bn during July–November, up 2.8% year-on-year and accounting for roughly 61% of total national exports. Beneath that headline, however, the trend is deteriorating.
November marked a turning point. Textile exports fell 2.7% year-on-year and 11.7% month-on-month, signalling a slowdown as cost pressures and weakening demand converge. Traditional textile categories continue their long decline: exports of conventional and raw-material-based products have shrunk from $1.78bn in 2021–22 to $1.28bn in 2025–26 (July–November).
Sharp contractions were recorded across cotton (–8.7%), man-made filaments (–17.6%), carpets (–15.3%), knitted fabrics (–31.1%) and vegetable fibres (–41.2%). These segments, once the backbone of Pakistan’s export base, are steadily losing relevance amid global competition and domestic inefficiencies.
Value-added apparel offers partial relief. Chapters 61–63 rose from $6.05bn to $6.56bn over the same period, posting a modest ~2% CAGR. Growth in knitwear, non-knit apparel and made-ups lifted value-added exports by 5% in FY26. Yet even here, cracks are visible: declines in bed linen, T-shirts, gloves and men’s woven apparel point to eroding competitiveness in core categories.
Market-wise, the EU remains Pakistan’s largest destination at $3.11bn, followed by the US at $2.10bn and the UK at $772m. But across all three, key product lines—from cotton ensembles to bed linen and T-shirts—registered double-digit declines. Bangladesh and the UAE together added around $549m, largely concentrated in yarns, fabrics and volatile apparel demand.
The pattern is familiar. Pakistan’s textile sector remains resilient where value addition exists, but high energy tariffs, rigid wage policies and cost disadvantages relative to regional peers are steadily eroding gains. Without addressing these structural constraints, incremental growth in garments will struggle to offset the long slide in the industry’s traditional base.
