Knitwear (hosiery) sector playing vital role in value addition of textile sector
by Prof. Dr. Noor Ahmed Memon, Dean FBMS; Metropolitan University, Karachi,

The knitwear (hosiery) sector is the highest value-added textile sectors in Pakistan, fetching US$ 3.0 billion from exports in the year 2019. Some of the bulk export items that have gained popularity are 100% cotton T-shirts, sports shirts, vests, slips, undergarments, knitted garments, and knitted tabulator or flat fabrics.

The popularity of knit goods has grown tremendously in the recent years because of the increased versatility of knitting techniques, the adaptability of many new manmade fibers and the growth in the consumer demand for wrinkle resistant, stretchable, snug fitted garments, particularly in greatly expanding areas of sportswear and other casual wear garments.

This sector has export potential, despite remaining under pressure from its competitors, mainly Bangladesh, India and the Far Eastern nations. Knitwear (hosiery) sector, being the largest foreign exchange earner as well the largest contributor in the textile and total export of the country. Demands deserving attention of the government to diversify knitwear products to bring more innovations and incentives to boost its exports.

Pakistan is the fourth largest cotton producer in the world and is an important player in the global textile market. Its knitwear industry is the highest value-added textile sector in the country and is distinguished by the high quality of raw material and competitive value of the end product.

At present hosiery and (knitwear) units of Pakistan comprise 3,500 large, medium and small units, 85% of which are small enterprises, 10% medium ventures and only 5% largely integrated factories. The industry sustains directly livelihood of 210,000 skilled workers and 490,000 unskilled workers. Another 350,000 people benefit in allied cottage industries. Thus, the industry provides directly and indirectly sustenance to well over a million people. Knitwear exports consists of knitted and processed fabrics knitted garments; knitted bed sheets, socks etc. 

At present 13,372 circular knitting machines, around 10,646 flat knitting and 23,241 socks knitting machines spread all over the country. Current production of knitwear is at the level of 1.1 billion pieces. Out of this production, 60% comprises of the jersey, knitted fabric, T-shirts, sweatshirts, polo shirts, jogging suits, track suits and children outerwear.

The world produces over 17 million tonnes of knitted textiles and apparel representing one-third of the global textile market. Moreover, the output is forecast to grow by 25% over the next five years, reaching more than 21 million tonnes.

Import of machines:

The import of a large number of automatic flat knitting machines has also contributed to improvement in quality of knitted fabrics, which in turn, helped the country to earn substantial foreign exchange through exports of knitted fabrics and knitwear.

The machinery used in the knitting sector, for circular and flat knitting is largely imported from Europe, Japan and China. Due to low-investment involvement, this industry is very easy to invest in such machines and furthermore, some of the machines and parts are also manufactured locally.

Pakistan imported mainly automatic flat and circular knitting machines of different brands. Import of various types of knitting and embroidery machines in Pakistan increased from Rs 1969 million in 2016-17 to Rs 4509 million in 2018-19, thus showing an increase of 128% per annum. Import of knitting and embroidery machines in Pakistan are given in Table 1.

Table 1: Table 1:Import of Knitting and Embroidery Machines
                                                                                       Value: Rs. Million

Machines

2015-16

2016-17

2017-18

2018-19
 Circular Knitting Machines (Dia - 165 mm) 332 729 1,190 2,097
 Circular Knitting Machines (Dia >165 mm) 313 453 835 1,184
 Flat Knitting Machines (Stitch Bonding) 460 275 316 558
 Other Circular Knitting Machines. 453 512 369 670

                                 Total

1,558 1,969 2,710 4,509

 Source: Pakistan Bureau of Statistics.

Exports

The knitwear goods exported from Pakistan are known for their fine quality in European, American and UAE markets. It is a highly value-added item, earning much valuable foreign exchange, as per kg cotton converted into finished garments fetches better margins. Knitwear exports consist of processed knitted fabrics and knitted garments.

During the past few years, the segments of knitwear and selected items of ready-made garments have shown an appreciable rising trend in exports. The use of knitwear (hosiery) has increased primarily due to its low price, as compared to cotton woven shirts due to easy care properties. However, export of Knitwear (Hosiery) increased from 108 million dozen worth the US $ 2.71 billion in 2017-18 to 111 million dozen worth the US $ 2.90 billion in 2018-19, thus showing an increase of 7% in terms of value.

The main items of export in knitwear from Pakistan are elegant men's T-shirts, fancy ladies T-shirts with exquisite embroidery and sequined work, night shirts for ladies and men's pyjama sets, sportswear and jogging suit, trousers, bed sheets knitted and socks. Techniques of designing, printing, embroidery and dyeing of the fabric have become well developed over the years. The statistics pertaining to the exports of knitwear from Pakistan are given in Table 2.

Table 2: Export of Knitwear and (Hosiery) From Pakistan

Year Quantity
(000 Doz)
Value
(US $ Million)
Average
(Per Doz)
2014-15 111,068 2,406 21.66
2015-16 112,459 2,364 20.87
2016-17 114,091 2,362 22.69
2017-18 108,503 2,711 24.50
2018-19 111,550 2,899 25.98
 Source: Trade Development Authority of Pakistan.

In knitwear, the US market alone accounted for 37% of total knitwear with exports of US$ 1,083 million in 2018-19. About 15% of knitwear exports went to United Kingdom, while the share of rest of the world was 52%. The United States, UK, Germany, The Netherlands, Spain, Belgium, France, Italy and Canada are the top nine trade partners for Pakistan. The country-wise exports of knitwear are given in Table 3.

Table 3: Country-wise Export of Knitwear (Hosiery)
                                                              (Value in $ 000)

Country

2018-19 2017-18 2016-17
 U.S. America 1,083,225 963.797 876,104
 United Kingdom 418,940 427,183 367,877
 Germany 224,263 218,824 181,868
 Spain 221,320 202,811 181,745
 Netherlands 234,612 197,378 143,725
 U.A.E 48,566 65,945 38,193
 Poland 30,764 20,584 15,125
 Italy 62,951 68,057 51,919
 Australia 24,532 21,983 16,577
 Belgium 121,775 147,808 145,423
 France 59,624 65,986 63,257
 Denmark 23,990 21,875 20,634
 Japan 24,532 20,888 15,035
 China 32,668 25,136 17,623
 Russia Russian Fed. 18,972 13,584 15,155
 Mexico 15,725 12,702 15,523
 All others 253,418 194,677 175,021
 Total 2,899,877 2,711,201 2,361,458
 Source: Trade Development Authority of Pakistan.

Future Prospects

The knitwear (hosiery) industry is playing a vital role in value addition of textile sector. In the export field, the hosiery knitwear industry of Pakistan has managed to make a big name in many countries of the world. The knitwear sector also provides employment to millions of workers, who work on stitching machines like garment stitching unit. The textile exports are 58% of total nation's export. Pakistan's textile export share in global market is just 2.05%. Pakistan knitwear (hosiery) industry is playing a vital role in value addition of textile sector.

During the past few years, the segments of knitwear and selected items of readymade garments have shown an appreciable rising trend in exports. The use of knitwear (hosiery) has increased primarily due to its low price, as compared to cotton woven shirts due to easy-to-wash nature. Inherent qualities like softness, coolness, sweat absorbent and durability have made knitted garments popular especially in developed countries.

The value-added sector achieved growth because of preferential access to the 28-nation European Union under the GSP+ scheme which can further be enhanced with the government’s support.

This sector has an export potential, despite remaining under pressure from its competitors mainly Bangladesh, India and the Far Eastern nations. "Knitwear (hosiery) sector, being the largest foreign exchange earner as well the largest contributor in the textile and total export of the country. Bangladesh’s knitwear share stands at US$ 16.89 billion, which is 42% of their total country’s exports of US$ 40.53 billion in 2018-19.

There is a great potential of further development in this industry as there is substantial value addition in the form of knitwear apparel, sportswear, socks, gloves, etc.  Now Pakistan requires more investment in ‘Knitting’. Most of the new machinery is bought only by the big companies to build vertical capacity reducing outsourcing in ‘knitting’.

However most important part is when a sector needs investment, it should not just go behind machinery and capacity building.  Investment should be done to reduce cost and to increase value addition. Knitting units should invest to increase productivity, efficiency, reduce cost and increasing automation.

References

  1. Pakistan Bureau of Statistics.
  2. Pakistan Economic Survey- 2018-19.
  3. Pakistan Knitwear & Sweater Exporters Association (PAKSEA).
  4. Trade Development Authority of Pakistan.

 

 
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