LAHORE - The garment industry has been hit hard by the prevailing energy crisis as the local garment exports fell by $140 million in the fiscal year 2012, and its share in the country’s total exports has also drastically reduced, manufacturers said.

Pakistan is the world’s fourth largest cotton producer and the third largest consumer. Cotton-based textiles contribute over 60 percent to country’s total exports, 45 percent of the total manufacturing and provide employment to about 40 percent manufacturing labour force. But during the period under review its share in the total exports has reduced to about 53 per cent, said Chief Coordinator and former chairman of the Pakistan Readymade Garments Manufacturers and Exporters Association (Prgmea), Ijaz A Khokhar on Sunday.

He asked the government to utilise the Export Development Fund (EDF) to help the ailing export sectors. He added that there was also a need for implementing the textile policy to devise a long-term solution for overcoming industrial stagnation. He said that the local garment exports fell by $134 million in the fiscal year 2012 due to slump in industrial output on acute shortages of electricity and gas during the past year, resultantly they suffered eight percent decline in exports of readymade garments in the last fiscal year.

He said that garment exports had declined by at least 15 percent, terming official statistics unreal. He said that the production of garments had declined by 40 per cent because of persistent shortages of electricity and gas.

With the availability of just six to eight hours of electricity to industrial units, how the country could increase its exports, he said, adding that the quantum of imports, however, surged in the previous fiscal year, urging the government to provide financial assistance. He said that a five percent relief in taxes and levies could help boost industrial output and help manufacturers battle soaring inflation and rising cost of doing business, besides helping them offset the effects of the unavailability of power and gas.

Prgmea former chairman Ijaz A Khokhar said that garment exports declined by about $140 million, from $1.78 billion in fiscal year 2011 to $1.64 billion in fiscal year 2012. Based on official predictions of persisting power and gas outages, exporters are not seeing a bright year ahead, he said.

He said that labourers had become 30 percent more expensive, adding to the overall cost of production, making domestic products uncompetitive in global markets. Expressing concern, he said that despite the presence of lucrative opportunities, local investment had completely stopped. He said that lack of confidence in the system has quashed investors’ hopes about progress. He said that growing unemployment would impact the country’s fragile economy, suggesting the government should introduce realistic policies. He feared that the government’s growing reliance on IMF’s financial assistance would sink the country’s economy forever.