By Muhammad Soban ISLAMABAD, Feb. 22, (INP-WealthPK): Pakistan’s carpet industry has been facing numerous roadblocks and bottlenecks during the last 10 years due to which the exports are falling steadily. The exports declined almost 58 percent from a total of $131 million in 2011 to $54.48 million in 2020. The total exports of carpets and floor covering textiles were worth $54.48 million in 2020, 18.62 percent less than in 2019 when the total carpet exports were $66.95 million. The following graph gives a glimpse into the export volume. Pakistan’s carpet industry boomed and prospered apace from the 1970s to 2000. Two important factors contributed towards the fast growth in this sector. One of the factors was the revolution in Iran – a major production hub and competitor in the world carpet market – which brought a decline in carpet production. Pakistan benefitted from this decline and earned a handsome foreign exchange. The second factor was the arrival of Afghan refugees in Pakistan due to the Soviet invasion of Afghanistan. The Afghan refugees brought technology, fabrics, varieties, weaving skills, and natural dyes, which helped the carpet industry of Pakistan to contribute more in form of the best exports to the world market. Pakistan’s industry employs the Persian technique in production of carpets and rugs and provides employment opportunities to around 1.5 million people. Though the carpets and rugs are exported around the globe, the top destinations are the USA, Germany, the UK, Italy, and Japan. The share of total exports is given in the following table.

Pakistan's top exports destinations of carpets
Country	Share in Percentage	Value (in Million)
United States of America	50	27
Germany	9.65	5.26
United Kingdom	4.58	2.49
Italy	4.36	2.37
Japan	3.4	1.85

  India and Iran are the leading competitors of Pakistan in the world carpet market. The Indian export of carpets and other textile covering floor has increased over the years and reached $1.6 billion in 2020 from $1.2 in 2011. On the other hand, Iran was also exporting around $800 million worth of carpets and rugs till the US sanctions. Pakistan’s carpet industry has been facing many challenges due to which carpet exports have been falling over the last 10 years. There is almost 58 percent decline in exports from 2011 when carpet exports were $131 million, which have fallen to $54 million in 2020. The first major challenge is the shortage of skilled labor. During the Afghan war, the Afghan refugees invested their carpet weaving skills in Pakistan, giving a boost to its carpet industry. Since they are repatriating to their motherland, the industry has suffered a serious shortage of skilled labour. The second serious challenge is that the competitiveness of Pakistan’s carpet industry is very low compared with its competitors in the region i.e., India and Iran, which are producing high-quality carpets and rugs at a low cost. The third problem is that Pakistan is still producing hand-made carpets, while other competitors like China use technology for mass production of carpets and rugs with less cost of production. In order to make its carpets and rugs competitive in the international market, Pakistan has to shift from traditional to advance technology. Still another serious challenge is that Pakistan has been facing a serious energy crisis during the last two decades that has seriously dented every economic sector, including the carpet industry. Though electricity has been made available to the industry, the high cost of energy is making our products expensive and hence uncompetitive in the international market. The Government of Pakistan needs to facilitate this industry in terms of skill enhancement of the workforce and provision of subsidized power, enabling it to effectively and successfully compete with its competitors.