Textile Industry in Pakistan and Bangladesh: Comparison, Challenges and Future Prospects

Abstract

Pakistan and Bangladesh began their journey into the global textile and apparel market from similar baseline but their paths have been far different. This study analyzes the textile and apparel sectors of both countries employing a fixed comparative framework that consists of 8 factors in a structured, qualitative comparative framework: industrial structure and production capacity, policy, legal and institutional framework, trade performance and tariff regime, energy, infrastructure and logistics, labour, wages and social compliance, technology and R&D, sustainability and environmental compliance, investment, financing and ease of doing business. The literature review, data analysis, key findings, and policy recommendations are all presented using the same framework that addresses a key limitation of previous single-country studies that did not use a consistent comparative framework. The findings indicate that Bangladesh has been able to grow its export volumes to USD 38.5 billion in 2024, due to the policy predictability, low cost downstream specialization in ready-made garments and duty exemption for textile imports in the country, whereas Pakistan has shrunk its textile exports to USD 16.7 billion during the same period with high energy cost, irregular tax and refund system, low vertical specialization in man-made fiber and lack of institutional follow-up of successive textile policies. The study would conclude by presenting a prioritized set of policy recommendations for Pakistan, directly linked to the identified gaps, which will help in the near term and medium-term policy action.