Pakistan textile sector continues to recover in FY25
Total textile exports rose to $17.9 billion in FY25, the highest annual growth in three years
Haris Zamir
Business Editor
Experience of almost 33 years where started the journey of financial journalism from Business Recorder in 1992. From 2006 onwards attached with Television Media worked at Sun Tv, Dawn Tv, Geo Tv and Dunya Tv. During the period also worked as a stringer for Bloomberg for seven years and Dow Jones for five years. Also wrote articles for several highly acclaimed periodicals like the Newsline, Pakistan Gulf Economist and Money Matters (The News publications)
Pakistan’s textile sector continued its recovery in FY25, with total textile exports rising 7% year-on-year to $17.9 billion — the highest annual growth in three years — according to the latest trade data. In June alone, textile exports climbed 8% year-on-year to $1.5 billion, although slightly down by 1% compared to May.
The growth was largely driven by a surge in value-added textile exports and a strong rebound in cotton yarn shipments. Cotton yarn exports soared 37% year-on-year in June, while the value-added segment rose 9% year-on-year.
In local currency terms, textile exports stood at PKR 430 billion in June — flat month-on-month but up 9% year-on-year — buoyed by a relatively stable Pakistani rupee throughout the fiscal year.
The value-added textile segment, a cornerstone of Pakistan’s export economy, showed strong performance across key categories:
- Knitwear: Up 6% YoY to $455 million in June
- Readymade Garments: Up 11% YoY to $360 million
- Bedwear: Up 17% YoY to $273 million
- Towels: Flat at $87 million
Over the full fiscal year FY25, value-added exports rose by 13%, led by a 16% jump in readymade garments, a trend industry experts say signals growing global demand for finished textile products from Pakistan.
However, basic textiles remained a drag on overall growth. Raw cotton exports plunged 98% due to a weak domestic crop, contributing to a 13% year-on-year decline in the basic textile segment.
In PKR terms, FY25 textile exports reached PKR 4,996 billion, a 6% increase over FY24. The appreciation and relative stability of the rupee helped maintain export competitiveness while improving revenue predictability for exporters.
Looking ahead, analysts forecast textile exports could reach $19-20 billion in FY26, supported by continued recovery in global demand, policy incentives, and further growth in value-added segments.
“The textile sector has seen a strong rebound over the past two years, and we expect this upward trajectory to continue,” a senior industry analyst noted.
A key potential catalyst in the near term is the ongoing U.S.-Pakistan trade negotiations, with results expected before or on August 1. Industry stakeholders are watching closely, hoping for favorable terms that could expand market access for Pakistani textiles in the U.S. — Pakistan’s largest single-country export destination.
A sector in recovery
Pakistan’s textile sector, which accounts for over 60% of the country’s exports, has faced a turbulent few years due to global supply chain disruptions, currency volatility, energy shortages, and inflation. However, policy support and improving macroeconomic stability have helped the industry regain its footing, particularly in value-added exports.
With stable currency conditions, an improving export environment, and potential trade facilitation measures on the horizon, FY26 may offer a fresh chapter of growth for one of Pakistan’s most vital industries.
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