Faisalabad power loom crisis deepens as 100,000 workers lose jobs
Faisalabad power loom crisis deepens as 100,000 workers lose jobs
Small power loom units across Faisalabad and adjoining towns are shutting down in large numbers, and the Faisalabad power loom crisis has now cost over 100,000 workers their jobs, industry representatives say.
Around 40 per cent of units have closed in a sector that operates nearly 800,000 looms. Loom owners blame cheaper Chinese yarn, grey cloth and finished textile products, along with rising utility bills and taxes.
“This small industry is in great trouble these days because it is no longer competitive in a market dominated by Chinese yarn, grey cloth and even finished cloth being imported in bulk,” Aslam Meraj, president of the Textile, Power Loom and Garment Workers Union Faisalabad, told Dawn on Tuesday. He said imported products were cheaper than local goods while rising utility bills and taxes had made survival increasingly difficult for operators.
“More than 100,000 power loom workers have become jobless. Power looms are being closed on a daily basis and workers are being terminated,” he said, criticising the government for failing to protect the local industry.
Why the Faisalabad power loom crisis is worsening
Faisalabad, often described as the Manchester of Pakistan, houses nearly 800,000 power looms in establishments ranging from small workshops to factories holding between 1,000 and 5,000 looms. The looms weave grey cloth from yarn after it is processed at sizing units.
Industry representatives said yarn imported from China was largely polyester-based and was being used by exporters to manufacture grey cloth, some of which entered the domestic market when exports declined, undercutting local operators.
“The industry, especially small power looms and sizing mills, is facing serious problems at the moment,” said Shakil Ansari, president of the Faisalabad Sizing Mills Association. He said border closures had disrupted cloth movement to Afghanistan and Central Asia, road closures on routes to Khyber-Pakhtunkhwa had hit grey cloth trade, and payments from KP traders were delayed. “All these issues, coupled with high utility bills and taxes, have brought the industry to a grinding halt,” he said.
Muhammad Sabir, who owns a unit of 44 power looms in Faisalabad, criticised the government for allowing the imports. “I don’t know why the government has allowed imports of Chinese thread and other textile-related goods at the cost of its own businesses,” he told Dawn, also complaining about high utility bills, FBR taxes and labour inspections.
Industry seeks tighter checks on under-invoiced imports
The Council of Loom Owners Association has written to Commerce Minister Jam Kamal, seeking stronger import valuation controls through verification of export declarations.
The association said under-invoicing in imports, particularly of fabrics, yarn and other textile products from China, remained a serious concern for domestic manufacturers. It alleged that some goods were exported from China at higher declared values, but lower values were declared when they entered Pakistan to reduce duties and taxes, creating unfair competition and costing the government revenue.
Pakistan and China already operate an Electronic Data Exchange mechanism between their customs administrations to address misdeclaration and under-invoicing. The association said the mechanism needed strengthening for consignment-level verification of values declared in Pakistan against the export declarations filed with Chinese customs.
It proposed that importers submit a copy of the Chinese export declaration with the Goods Declaration filed in Pakistan, so that declared values, HS codes and quantities could be reconciled and material discrepancies investigated.
What happens next
The loom owners’ letter puts the ball in the commerce ministry’s court. Without relief on energy costs and imports, industry leaders warn more units will shut and job losses will mount.
Frequently asked questions
How many power loom workers lost jobs?
Over 100,000, with about 40 per cent of the sector’s nearly 800,000 looms shut.
Why are power loom units shutting down?
Owners blame cheaper Chinese imports of yarn, grey cloth and finished products, high utility bills and taxes, disrupted trade routes, and delayed payments from traders.
What is the industry asking the government to do?
The Council of Loom Owners Association wants stronger import valuation controls, verification of Chinese export declarations, and action against under-invoicing.
