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Knit wear industry.

Knit Wear Industry

According to the report of working group of Seventh Plan on textile industry, the production of knitted grey cloth is estimated at 19.22 million kgs. of 650 units. The capacity utilisation worked out to 54% per annum. This low capacity utilisation is due to old and outdated machinery, resulting in frequent break-down. However, with installation of new imported machines, total production of knitted fabric may be achieved to 26/27 million Kgs. on the basis of two shifts operation each shift of 12 hours.

The Knit-wear industry has made tremendous progress since its inception. Beginning in 1950 this industry had only two or three units in name only. It has now more than 650 units out of which 100 big ones are working in the organised sector and their number is increasing. In the early days this industry produced socks, bunyan and underwear. It is now producing value added items of all kinds of knit-wear which include sweat shirts, T-shirts, jerseys, jogging suits, track suits, various undergarments, pants, shirts, infant suits and night dresses etc. This industry has become big source of valuable foreign exchange earning for the country in the last five years.

Knitted garments are popular among all especially in the developed countries due to their inherent qualities like softness, coolness, sweat absorbent and durability.

Product Definition

Knitted fabrics are produced by interweaving with needle using only the warp. They are different from woven fabrics manufactured by inter-locking of warp and weft. In comparison with the knitted fabrics, woven fabrics have greater dimensional stability.

Due to unparalleled improvements made during 1980 in the knitting technology and techniques in the processing/finishing the dimensional stability of knitted fabrics have been considerably improved. Limits of shrinkage have also been narrowed. These advancements together with availability and use of soft twisted spliced yarn have resulted in the upsurge of worldwide consumption of knitted fabrics since 1985 for manufacture of outer garments such as 2-3 T-shirts sweat/poloshirts, cardigens, infant/children wear, skirts/blouses, godown's track suits, mittens etc.

Installed Capacity

According to Pakistan Knitted Garments Sweaters Exporters Association, there are above 650 knitting products manufacturing units in Pakistan having the following types of machines.

Out of total 3950 Circular Knitting Machines, only about 802 are imported machines. These machines include various type of machines such as single knit, double knit, (inter-lock), loop knit (terry/fleece), pique and rib body for garment accessories. On an average one machine out of eight machines is meant for manufacture of collars, ribs, borders etc. A large portion of these machines constitutes used and re-conditioned machines, imported over last eight years under "Non Repatriable Investment (NRI) Scheme". The total investment made in the re-conditioned and new imported machine is estimated to around Rs. 100-150 million. The addition of imported machines has contributed to improvement in quality of knitted fabrics which in turn, helped the country to earn foreign exchange through exports of knitted fabrics as well as knit-wear. Today, knitwear industry, alone provides direct employment of 15000 persons, skilled, unskilled men and women.

Presently about 12000 different types of knitting machines are available in the country. Out of these machines, 33 per cent are circular knitting, 12 per cent flat knitting for manufacture of tubular/flat knitted fabrics respectively and 55 per cent are available for socks knitting. The installation share of circular knitting machines in Sindh province is 59 per cent against average share of 33 per cent, whereas their share in Punjab and NWFP is 39 and 2 per cent respectively. Similarly the installation share of flat knitting machine in Sindh is 60 per cent, in Punjab 39 per cent and in NWFP 1 per cent against average share of 13 per cent of other available knitting machines. Province-wise the installation share of Sindh in sock knitting machines is 49 per cent while in Punjab and NWFP it is 50 and 1 per cent respectively.

In overall installation of knitting machines the share of Sindh is 42 per cent and Punjab & NWFP combined have 58% share. Similarly under machine category the share of circular knitting machines in three provinces is presently 33 per cent. Against this the share of flat knitting machine is 12 per cent and socks knitting is 55 per cent.

Installed Capacity

At present there are 650 units of knit-wear dispersed all over the country of which 40 units are fully integrated having their dyeing and printing houses attached with the stitch units whereas 610 are small scale units.

The combined capacity for manufacture of knitted grey fabrics in respect of these units has been estimated at 35.88 million kg. per annum. The estimation is on conservative side because during the last three years enough capacity has increased due to local as well as foreign demand of knitted fabrics.

Present Estimated Production

There is no reliable production data of knitted fabrics available in the country as this industry is considered only as textile ancillary industry which is mainly concentrated in the un-organised sector. Due to the un-organised nature of industry there is no published official production data available. In the absence of published data on knitted fabric production, the assessment has therefore been made on the basis of survey and discussions with concerned quarters of knitting industry. During the survey it was gathered that imported circular knitting machines are mainly used for producing cotton and blended yarn knitted fabrics for direct export as well as for conversion into knitted products for export purposes. It was also as certain that the locally fabricated knitting machines are generally used for catering mostly to domestic demand of knitted undergarments. These machines are regarded incapable of producing quality fabric for outer-wear export. Therefore these machines have been included for the purpose of estimation of production of knitted fabric.

According to the report of working group of Seventh Plan on textile industry, the production of knitted grey cloth is estimated at 19.22 million kgs. of 650 units. The capacity utilisation worked out to 54% per annum. This low capacity utilisation is due to old and outdated machinery, resulting in frequent break-down. However, with installation of new imported machines, total production of knitted fabric may be achieved to 26/27 million Kgs. on the basis of two shifts operation each shift of 12 hours.

Table No. III clearly indicates that production of knitted fabrics increased from 11.00 million Kg. in 1984-85 to 18 million Kg. in 1989-90 at an average growth rate of 9 per cent per annum.

TABLE - III

Estimated Production
 Production Growth
Year (Million Kgs.) (%)
1984-85 11.00
1985-86 11.60 5.45
1986-87 13.50 16.37
1987-88 15.30 13.33
1988-89 16.50 7.84
1989-90 18.00 9.00


Source: Expert Working Group Report on Textile Industry

Future Estimated Production

With the present installed imported machines it is possible that an additional production of 8/9 million Kgs. per annum will be achieved. At present the quality of knitted fabric which is generally produced in the country caters only to the lower end of market in foreign countries. To meet the international boom in the fashion knit-wear and fast shift from woven to high quality knitted apparel since 1985, new technologies have been introduced in the knitting machine for producing more sophisticated and better quality fabrics. Computerised and automatic machinery with CAD/CAM applications are only few in number in the country. Though quota restrictions exist in terms of quantities and not in value for Pakistan can maximise her export earnings through better quality products manufacturing by new generation machines ensuring stringent quality controls for satisfying the quality conscious buyers in the foreign countries.

In the light of the above facts and the fast changes taking place in the requirements of buyers abroad, the older machines in Pakistan will, in due course, have to be discarded/replaced or engaged for meeting the domestic requirements only. In such an event the present surplus capacity (8/9 million Kgs.) will not be available for exports, particularly to the up market in the foreign markets. In fact Pakistan will need at least 800-1000 modern machines to cope up with the increasing demand of both knitted fabric and knit-wear in the next 2/3 years for catering to middle and up market abroad.

Present Demand

The demand for knitted fabrics emanates mainly from knitwear industry which supplies knitted products to foreign countries. In addition to this demand knitted fabrics are also exported to a large number of countries mainly the European countries and USA. The exports of knitted fabrics and knit-wear from Pakistan are discussed below.

Knitted Fabrics & Knitwear

Knitted fabrics made up of cotton and blended with manmade yarn of various types, single knit, double knit, fleece raised and terry etc. are being exported from Pakistan to various countries. The export of knitted fabrics and knitwear from Pakistan during 1984-89 are shown in Table IV.

TABLE - IV

Export of Knitted Fabric of Cotton
 Quantity Value in
Year (SQM) % Increase (000 Rs.) % Increase
1984-85 110,258 1,264
1985-86 687,358 523.41 8,275 554.66
1986-87 2,881,381 319.20 38,525 365.56
1987-88 9,566,805 232.02 141,758 267.96
1988-89 13,885,538 45.14 215.607 52.09


Source: Federal Bureau of Statistics

From table No. IV it is evident that export of knitted fabric of cotton has phenomenally increased during last five years. Its quantum export increased from 110,258 square meters during 1984-85 to 13,885,538 square meters during 1988-89 i.e. during five years time the export quantity increased by 12493% and in term of value its exports increased by 16957%.

During 1984-85 its export FOB prices recorded at Rs. 11.46 per Square Meter which stood at Rs. 15.53 per SQM during 1988-89. This means that 35% of prices have been appreciated during five years time, thus fetched more foreign exchange for the country.

The Table No. V gives the export of knitted fabrics made up of man-made yarn also which increased from 729,672 SQM during 1984-85 to 3344869 SQM (358.40%) by 1988-89. In term of value export also registered increase by 577.07 per cent during five years time or average export increase by 67 per cent per annum.

TABLE - V

Export of Knitted FabricsMade up of Man Made Yarn
 Quantity Value in
Year (SQM) % Increase (000 Rs.) % Increase
1984-85 729,672 5,641
1985-86 929,471 27.38 7,295 29.32
1986-87 1,777,506 91.24 14,634 100.60
1987-88 1,407,931 20.79 12,960 11.43
1988-89 3,344,869 137.57 38,193 194.69


Source: Federal Bureau of Statistics

Export FOB prices of knitted fabrics made up of man made yarn remained very inconsistent during 1984-89. Fabrics of synthetic fibre exported on average FOB price at Rs. 8.01 per SQM, fabrics of silk yarn on average FOB price at 11.18 and fabrics made up elastic fibre at Rs. 17.00 per SQM during five years time.

Export of cotton knitted garments in terms of quantity recorded at 3480 thousand dozens during 1984-85 went upto 8375 thousand dozens thus increased by 141 per cent during last five years. By year-wise the average share of cotton shirt in overall export of cotton knitted garments was about 75 per cent, the combined share of knitted outer and under garments was 13 per cent whereas the share of women dresses was at 11 per cent and knitted Jersey shared one per cent only.

Export of knitted garments of cotton in terms of value registered during 1984-85 at Rs. 498.5 million gone up to Rs. 2915.5 million thus export increased by 45 per cent. Item wise average export of women dresses in terms of value increased by 1500 per cent, outer garment by 117 per cent, Jersey by 50 per cent, shirts by 33 per cent and under garments by 23 per cent during the last five years.

Export of knitted garment of man-made yarn in terms of quantity was registered at 101 thousand dozens during 1984-85 shot up to 224 thousand dozens by June, 1989, thus increased by 122 per cent during five years time. Item-wise the average share of shirts in overall export of man-made yarn made-up garments was 53 per cent, next item in order of merit was women-dresses which shared 39 per cent, third combinedly outer and undergarments Items shared by 32 per cent and Jersey's share was 5 per cent only.

In terms of exported quantity the share of knitted garments of cotton yarn registered at 95 per cent whereas the share of garments made up of man-made was 5 per cent during last five years.

Export of knitted garments of man-made yarn in terms of value was at Rs.26.5 million during 1984-85, however, reached to Rs. 102 million during 1989 showing increase of 285 per cent during five years times. Item wise the average export value of outer garments of man-made yarn increased by 43.2 per cent women dresses by 62 per cent, shirts by 45 per cent, jersey by 40 per cent and undergarment by 23 per cent respectively.

In export of other knitted articles - gloves shared 98 per cent in terms of quantity the other four items (brassiers, mittens, socks and stockings shared only 2 per cent.)

Export of other knitted articles increased by 73 per cent as its export value increased from 123.2 million during 1984-85 to Rs. 212.9 million during 1988-89. By item wise the export in order of value was gloves, the next item was brassiers, third one was socks and other came fourth and mittens and stockings were fifth and sixth in order of merit. From the figures given above it is evident that average export of other knitted articles increased by 29 per cent during five years time.

Details given above in paras 8.2 to 8.12 when summed up in Table-XII depicts rosy picture of exports of knitted fabrics, garments and other knitted articles.

TABLE - XII

Year-Wise Export of Knitted Fabrics & Garments All Sorts & Other Articles
 (Value in million Rs.)
 Other
 Knitted Knitted Knitted Total
Year Fabrics Garments Articles Export % Increase
1984-85 6.9 525.0 123.0 655.1
1985-86 12.6 761.8 121.5 895.9 37
1986-87 53.2 1508.4 153.4 1715.0 91
1987-88 154.7 2152.3 415.4 2722.4 59
1988-89 253.8 3018.3 213.0 3485.1 28


Source: Federal Bureau of Statistics

Export of knitted fabrics all sorts were at Rs. 6.9 million during 1984-85 progressively increased by 132 per cent per annum and reached to Rs. 253.8 million during 1988-89. Similarly exports of knitted garments increased from Rs. 525 million during 1984-85 to Rs. 3018.3 million during 1988-89 showed 45 per cent increase per annum. Export of other knitted articles year-wise showed very erratic trend. There was drop in export by 1.5 per cent during 1985-86. Compared 1984-85. It picked up during 1986-87 and 1987-88 by 26 and 171 per cent respectively but declined again to 49 per cent during 1988-89. Average annual increase, however, depicted at 146 per cent during 1984-85.

Total export of knitted fabrics, garments and other articles was at Rs. 655.1 million during 1984-85 progressively increased from year to year reached at Rs. 3485.1 million during 1988-89. During 1985-86, export of knitted goods increased by 37 per cent compared to export figures of 1984-85. It further went up to Rs. 1715 million thus increased by 91 percentage terms. During 1987-88 and 1988-89 their exports were at Rs. 2722.4 and 3485.1 million respectively showing increasing trend in absolute term but compared to 1986-87, their increasing percentage was 59 and 29 per cent only.

Average export FOB prices of shirts during five years prevailed at Rs. 225 per dozen it means that one shirt was exported at the rate of Rs. 19.00. Jersey's fetched Rs. 346 per dozen it means one jersey was at the rate of Rs. 29.00. Dresses for woman another important item of knitted garments were exported at the rate of Rs. 386.00 per dozen earned foreign exchange of Rs. 31.00 for one women dress. Outer knitted garments were exported at the rate of Rs. 347/-per dozen fetched Rs. 29.00 for one piece of outer garment. Against this under garment was exported at the rate of Rs. 165/-per dozen sold for Rs. 14/-per piece. Other knitted garment classified else-where were exported at the rate of Rs. 200/-per dozen or Rs. 17/-per piece.
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Title Annotation:Pakistan's knit-wear industry
Author:Islam, Mazharul
Publication:Economic Review
Date:Jan 1, 1991
Words:2787
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