The Harappa civilization residing in Pakistan, four thousand years ago, has provided the country with the heritage of spinning and weaving. Since then, Pakistan has carried forward this age-old tradition and prospered to become the eighth-largest exporter of textile products in Asia. The country is also the fourth-largest producer of cotton and, after India and China, has the largest spinning capacity in Asia.

Pakistan is a land with 442 spinning mills, 1260 ginning units, 2550 garment manufacturing companies, and 600 knitwear-producing units. Textile products like carpets, rugs, towels, tents, home textiles, hosiery, and apparels are manufactured here to be exported to countries like the US, Hong Kong, the United Kingdom, Germany, Italy, France, the Netherlands, Dubai, and Afghanistan. Textile is a strong pillar supporting the economy of Pakistan. Textile products and garments constitute almost 50 per cent of the total international exports and account for almost 8.5 per cent of the GDP of the country, employing 38 percent of the production labor workforce.

The spinning industry of Pakistan functions in a competitive but free environment as long as procurement and the use of raw materials are concerned. Scarcity of crop led to the sourcing of international cotton in Pakistan, which began a decade ago. Today, the nation approximately sources 3 million bales from the international market and produces close to 11.5 million bales domestically.

Pakistan enjoys a Free Trade Agreement with the European Union. Thanks to the textile industry of the country, Pakistan enjoys healthy relationships with the EU. The European Union has relieved Pakistan from tariffs on exports of products, and also the law signed in December 2013 granted the nation a Generalized Scheme of Preferences status (GSP Plus). The deal and allocation of work began in January 2014 and will continue until the year 2017. While the European Union will benefit from importing cheap textile products from Pakistan, the latter will seek an advantage by creating jobs in the sector and also lead to economic growth. The GSP Plus is estimated to increase exports worth $650 million from textiles and apparels alone in the first year of its agreement.

The government of Pakistan has also made improvisations in the textile policy of 2014-2015 in order to support and uplift the sector. The revisions emphasize proper infrastructural facilities, adequate investments, proper training centers, research institutes for developing quality products in the textile industry. It will also concentrate on regional trading to expand production capacities of garments in Karachi, Islamabad, and Faisalabad.

However, there have not been enough efforts from the country's government in the matter of the energy crisis. The government has not yet fulfilled the promise of installing continuous electricity and gas plants to boost power supply. This has affected the textile industry of Pakistan tremendously. Manufacturers had to move to alternative methods of producing electricity like generators and inverters, ultimately leading to a rise in the costs of production. The shortage of electricity hence increased expenses and reduced profitability for textile exporters of the country. As a result of the lack of power supplies, many factories closed down, and thousands of individuals remained unemployed.