Textiles and Garments: Moving up the Value Chain

Garments manufacturing is the least energy and capital-intensive industrial activity and thus, resonates with Pakistan’s resource endowment to generate economic growth and employment. Despite, its major contribution to Pakistan’s exports, its immense potential is not being realized. An important reason for the poor growth of the garments sector is that Pakistan exports a limited number of products and barely (if at all) competes in those products that account for about 60 percent of the world trade. To fully realize its potential, garments manufacturing must move up the value chain.

This research project has been conducted in two phases:

Phase I examines trends and structural change concerning textile and garment exports, the barriers to garments sector growth and the actions taken by industry leaders and firms to improve resource management and competitiveness.

Phase II emerged in response to strong stakeholder demand following the findings of Phase I. After attaining GSP+ status by the European Union (EU), Pakistani exports to EU markets enjoy lower tariffs. Given this development, Phase II focuses on accelerating productivity growth and the move to higher value garments manufacturing. In addition to documenting the Punjab government’s efforts to improve this sector, Phase II shares insights on the garment sector from interviews with randomly selected garment manufacturing firms in Sialkot and Faisalabad, Punjab, as well as firms studied for Phase I. These interviews gather perspectives from firms on issues such as the impact of the GSP+ status, international collaborations, barriers to relocating a garments industrial city and paths to higher productivity.

Publications

Garments as a Driver of Economic Growth
March 2013 | Naved Hamid and Ijaz Nabi
Read the report

A Comparative Analysis of the Garments Sector
April 2013 | Syed Turab Hussain, Kashif Zaheer Malik, Usman Khan, Adeel Faheem, Ijaz Nabi, and Naved Hamid
Read the report

The Textiles and Garments Sector: Moving up the Value Chain
September 2014 | Naved Hamid, Ijaz Nabi, and Rafia Zafar
Read the policy brief
Read the report

Implementing Policies for Competitive Garments Manufacturing
January 2017 | Naved Hamid and Ijaz Nabi
Read the report

Blogs

Moving Pakistan up the value chain: Opportunities in textiles and garments
The International Growth Centre | 29 July 2015 | Hina Shaikh

Has GSP plus status improved Pakistan’s garments exports?
Developing Pakistan | 24 May 2017 | Zara Salman

Garments exports, job creation, and growth in Pakistan: The way forward
Developing Pakistan | 12 October 2017 | Ijaz Nabi