How the location economies is leveraged?

Answer: Pakistans textile industry which is known for one of the best producer and quality products in the worlds textiles market.Huge amount of textiles products are produced everyday in different mills of Pakistan. Being one of the finest producer ,Pakistan exporting their products in different countries . But competitors make its always a difficult task for Pakistan. LOT OF COMPETITORs such as chaina,Bangladesh,india,mexico etc. Are biggest compeiors on the worlds textile sectors. Everybody compete with one another through price,quality. Some of them offer at a low price or some of them deliver the quality products. Price are the big factors that can give you advantage always. The advatges always depends on your competitive situations.Its means that how you compete with others on the market. Pakistans have been enjoying lot of advantages for its economical structure.Some of the factors that always giving Pakistans textile industry to compete with the market. Theorically, it can be explained in may ways. Micahle Porter developed an idea, which is known as Daimond porter model.Actually this this competitive advantage theory helps to determine what factors and how it gives a advantages to pakistans textile sector The Diamond Porter Model so called because the six factors collaboratively work together to give a country a picture of where it is standing. From collected different materials and data on textiles industries, we analysis it with Michael porters theory of competitive advantage -

Factor Conditions: In Factors of Production , Michael porter has stated that some criteria such as physical resources, human resources, capital resources etc. That can give an advantages always.From our study,we found that Pakistan has a total labor force of 55.88 million (as of 2009) which 40% are involved on textile and related industries. When majority peoples are involved in this sectors,so definitely it becomes a big sector for a country.This sector contributing 38 percent of total manufacturing and 8 percent of total GDP.But actual reasons is that to succeed on this particular industry is, infrastructure , skilled labour ,technological support,raw materials,natural resources.etc.all of these giving Pakistan a competitive advantage. Labour wages are very cheap in Pakistan,average a labour receive 5000 rupees per month . Textile mills have been using different kinds of machine to improve production capacity as others developed nations has been using.It is good things that,most of the textile mills and cooton,spinning mills are family traditional businesses.It runs from the past from one generation to next. Cotton industry of Pakistan is the 4th largest most producer of cottons in the world.

Demand Conditions: Pakistan's export focused textile industry (textile contributed 53% to total exports). the foreign demand for Pakistans cotton yarn has risen exceptionally. Chinese, in particular, have procured huge quantities of yarn from Pakistan, even though they are the fiercest competitor of Pakistan in the world market. In the first six months of the current fiscal year Jul-Dec. 2009, the export of cotton yarn recorded an increase of 50%. Spinning industry makes the basic raw material for the downstream industry. The existing capacity in the spinning sector is more than local demand, and hence moderate quantities of yarn are exported each year. With excessive exports during the year, the downstream industry started facing severe shortages of yarn. Consequently, the downstream industry began to close down. In January, 2010Government imposed a quota of 50 million kg per month for export of yarn. During January 2010, 56 million kg was exported as appropriate measures to give effect to quota were not put in place in time. The availability of yarn in the local market remained scant and prices kept rising

Describes the state of home demand for products and services produced in a country.Home demand conditions influence the shaping of particular factor conditions. They have impact on the pace and direction of innovation and product development. According to Porter, home demand is determined by three major characteristics: their mixture (the mix of customers needs and wants), their scope and growth rate, and the mechanisms that transmit domestic preferences to foreign markets. Porter states that a country can achieve national advantages in an industry or market segment, if home demand provides clearer and earlier signals of demand trends to domestic suppliers than to foreign competitors. Normally, home markets have a much higher influence on an organization's ability to recognize customers needs than foreign markets do

*****Demand Conditions: Michael Porters second statement is demand conditions that describes the state of
home and foreign demand for products and services produced in a country.Home demand conditions influence the shaping of particular factor conditions. This may create or improve the direction of innovation and product development. Pakistans textile sector contributed 53% of total exports of Pakistan. Pakistan exporting their product in U.S.A,china,U.K etc.In U.S.A , Pakistan captured the 3% market share of U.S.As total imported textiles apperals or cloths. Porter states that a country can achieve national advantages in an industry or market segment, if home demand provides clearer and earlier signals of demand trends to domestic suppliers than to foreign competitors.The local demand of cotton has been increasing day by day in Pakistan .chaina,which is the worlds largest producer of cottons has fall down. So,demand increase in Pakistan to export cotton to foreign market as well as meet the need of local supplier..Local demand for finished products has been increasing day by day by day. Factors that helps to Pakistan to maintain low cost and rises the demand. Quality of Pakistans textile product are very good. Related and supporting industries: The existence or non-existence of internationally competitive supplying industries and supporting industries. One internationally successful industry may lead to advantages in other related or supporting industries. Competitive supplying industries will reinforce innovation and internationalization in industries at later stages in the value system. Besides suppliers, related industries are of importance. These are industries that can use and coordinate particular activities in the value chain together, or that are concerned with complementary products (e.g. hardware and software). A typical example is the shoe and leather industry in Italy. Italy is not only successful with shoes and leather, but with related products and services such as leather working machinery, design, etc. Michael porters has stated that ,one successful industry depends on the relative and supporting industries of this sector of particular country. And