The export of yarn has come to a halt due to drastically falling profits in the wake of a depreciating dollar, resulting in higher availability of the raw material at cheaper rates in the domestic market.
Yarn exporters who sold their products at the rate of Rs160-161 now face a decline in their profits. The dollar is around Rs157 in the inter-bank market, with daily fluctuations in the exchange rate. The dollar lost 7.5pc in value since August against the Pak rupee.
It may be mentioned here that the value-added textile sector had been demanding the government to allow the import of yarn as locally produced yarn is more expensive, which spinners opined were costlier due to costly cotton imports.
According to a local media report, imported cotton would also be much cheaper for the industry in Pakistan with a decline in the value of dollar. As production costs increase due to costly cotton, production in the country fell by 34.4 per cent against the target while consumption continues to increase.
Earlier, apparel makers had lamented about hindered production activities due to the short supply of cotton yarn in the local market, which made them unable to meet export orders.
Concerned parties of the industry had demanded permission for duty-free import of cotton-yarn from India as well as a ban on the export of the material.
