Group Members:

Asaad Imtiaz Abeeha Lone Haroon Nisar Xainab Husnain

Introduction
Towels are one of the most exported textile material in

Pakistan.
There are approx 7500 Towel Looms. Pakistan is now the second largest exporter of Towels and its

share in world export is 8%.

Hs Code for Towels is:-

481820 (http://www.foreign-trade.com/reference/hscode.cfm)

PAKISTAN TOWEL EXPORTS

19961997 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 194,132 200,056 177,661 195,626 243,025 269,823 374,839 403,500 520,480

Years
600,000 500,000
400,000 300,000 200,000 100,000 0 1996- 1998- 2000- 2002- 200497 99 01 03 05
Source:ALL PAKISTAN TEXTILE MILLS ASSOCIATION (APTMA)
Years

PAKISTAN TOWEL EXPORTS

2005-06 587,641 2006-07 610,712
650,000 640,000 630,000 620,000 610,000 600,000 590,000 580,000 570,000 560,000 2005-06 2006-07 2007-08 2008-09
Source:ALL PAKISTAN TEXTILE MILLS ASSOCIATION (APTMA)

2007-08 615,415

2008-09 642,889

Years

Reasons for variations in exports

Quota was one of the main restrictions towards

increasing exports.
The demand of Pakistan textiles rises due to cheap

prices.

Source:-

http://www.jstor.org/pss/4414918

TOP 10 EXPORTS OF TOWELS

Value in 000 dollars

COUNTRIES U.S.A

2008-09 312,224 52,508 32,878

2007-08 308,696 33,306 47,089 9,049 24,276 22,831 17,768 14,350 14,432 9,292

UAE
UNTIED KINGDOM SAUDIA ARABIA

28,041 23,742 18,861 16,407 15,524 14,573 12,984

ALL PAKISTAN TEXTILE MILLS ASSOCIATION (APTMA)

GERMANY
SPAIN ITALY SOUTH AFRICA NETHER LANDS

BELGIUM
Source:-

Competitors Analysis
Pakistan is behind because of higher prices of yarn Pakistan is the main exporter of yarn to china. China has captured a 2/3 of Australian market

Pakistan used to have a major share in the Japan where usage

of towels is very high. Pakistan lost this market to China due to high yarn prices.
Source:http://www.scribd.com/doc/16406688/Prefisibility-Report-

China Factor
Assumptions were that with the removal of quotas,

price/unit costs will become more critical & competitive.

Threat to Pakistan from Chinas explosive textile export

growth after the removal of quotas

It was determined that China can have 50% of textile and

clothes market in the world as of 2005.

Source:http://www.icrier.org/pdf/WP173b.pdf

China Factor
After effects were that china took most of the share in USA and EU

markets.

Chinas had a drastic increase of approx 330% in exports.

The goods of China, were very difficult to compete with, decreased

the price levels in the markets they entered, and offered best quality.

Source:-

http://www.icrier.org/pdf/WP173b.pdf

Use and advantage of agreements to Pakistan

Agreement on Textile & Clothing (ATC)

Phasing out of quota

1st major impact of the integration programme was in the third-

stage integration(on 1 January 2002)

Growth started In Jan 2002 Mid 2003 exports increased by 23% It has given advantage to towel industry.

Countervailing Duty: US serves notices on 11 towel exporters (January 27 2005)

US Department of Commerce to impose

countervailing duty on the exports of shop towels from Pakistan.

They demanded all trade related information from the

period from 1996 to 2001.

[C-535-001]

The review against the export of dumping or subsidized shop towels was undertaken after every five years. The first review was initiated in 1996 and

concluded in 2000
Finalization of duty on shop towels at the rates

ranging from 1.47 percent to 3.25 percent on different exporters.

Source: Courtesy Business Recorder http://www.pakissan.com/english/news/newsDetail.php?newsid=4596

Export of towel, bed sheets: EU move brightens Pakistans prospects

EU has put restrictions on the of Chinese textile

products into EU countries, particularly towels and bed sheets containing micro fiber (melamine) contents
This would certainly boost Pakistans exports of towels

and bed sheets to EU countries

Source: Copyright Business Recorder, 2009

http://www.aaj.tv/2009/11/export-of-towel-bed-sheets-eu-move-brightens-pakistans-prospects/

 Pakistans exports were suffering to the extent of 25

percent to 30 percent in the presence of China.

The issue was on the agenda of WTOTBT committee

meeting held in Geneva but was not discussed because China decided to withdraw this item at the last moment.

Source: Copyright Business Recorder, 2009

http://www.aaj.tv/2009/11/export-of-towel-bed-sheets-eu-move-brightens-pakistans-prospects

Greater market access to Pakistani products

EUs decision to provide greater access to Pakistani textiles

through a reduction in import duty

Duty free access to Pakistani textiles so that the country

may overcome the disaster caused by the devastating floods

Pakistan has a case for receiving special treatment from the

EU and it must gain duty free access for high demand items to generate employment and revival of industry. Source: Business Recorder
http://finance.kalpoint.com/highlights/business-news/greater-market-access-to-pakistani-products.html

Problems of Towel Industry

Technology constraints
Energy Crisis Lack of water supply in Karachi and poor condition of water

tanks
Infra-structure Restriction in foreign exports

CONCLUSION
The results show that their has been a constant increase in

towel exports since the quota removal.

Pakistan gained a larger share in the market in towel sector In case of towels, we are supporting ATC