By Hasnain Ali
In a stunning development for Pakistan’s textile industry, Gul Ahmed Textile Mills Limited (GATM) has announced it will shut down its export apparel division after years of mounting losses and relentless market pressures.
The decision was approved by the company’s Board of Directors on September 29, 2025, according to a notice submitted to the Pakistan Stock Exchange (PSX).
Why Gul Ahmed Made the Call
Former Chairman of All Pakistan Textile Mills Association (APTMA) Asif Inam said the cost of doing business in Pakistan is “going through the roof.” He added that APTMA will appeal directly to the prime minister to ask for relief for the troubled sector.
Gul Ahmed — a textile player since the early 1900s — pointed to several factors behind the shutdown:
- Rising fabric costs
- Soaring energy tariffs
- Tax changes, including a hike in advance turnover tax
- A stronger rupee
- Intense regional competition
Analysts say these issues made it impossible for the apparel export business to stay profitable.
A Global “Race to Zero”
“The apparel market worldwide has become commoditised,” explained AKD analyst Usama R. Gurmani. “Countries are locked in a price war, pushing Pakistan into a ‘race to zero,’ where profits shrink to nothing.”
But the news isn’t all negative. Because Gul Ahmed runs vertically integrated operations and a profitable retail segment, analysts believe the closure may actually stabilize or even improve its financial position. Other companies may also pivot toward high-value products and better efficiency to survive.
Pakistan’s Cost Disadvantage
Inam pointed out how Pakistan lags behind its competitors. Textile exporters here pay 12–14 cents per unit of electricity, while mills in India pay just 5–8 cents.
He also noted that Pakistan’s industry has imported modern machinery — some as new as 2022 — that could generate $7 billion in exports. But due to expensive electricity and high interest rates, this advanced equipment is sitting idle.
What the Closure Means for Gul Ahmed
According to GATM, shutting down the export apparel segment will help the company cut losses, reduce debt, and improve cash flow. Founded in 1953, the company emphasized that its other divisions remain profitable.
Still, one industry insider hinted that internal family disputes may have played a role in the decision. Even so, analysts agree that Pakistan’s textile industry has managed to survive — mostly with the help of government support.
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