Textile Exports: Policy Reversal Needed
- Pakistan's textile exporters are pressing the government to roll back what they describe as restrictive policies that threaten over $9 billion in value-added exports.
- In their letter,the associations highlighted tariff-related barriers and supply chain disruptions as critical issues needing immediate resolution.
- The textile industry also seeks the restoration of the exporters’ final tax regime to minimize compliance costs and administrative burdens, notably for smes.
Pakistan’s textile exporters demand urgent policy reversal to protect over $9 billion in value-added exports. Associations representing the industry are calling for immediate talks with Prime Minister Shehbaz Sharif to address tariff barriers and supply chain woes, especially concerning small and medium-sized enterprises (smes). The primary_keyword, Export Facilitation Scheme, needs reinstatement, alongside automated tax rebates and a zero-for-zero apparel tariff agreement with the U.S. The secondary_keyword, textile industry, faces significant challenges in accessing modern materials, hindering global competitiveness. Failure to act could lead to widespread closures and job losses, warn industry leaders. Learn how News Directory 3 is following this story and discover what’s next for the industry.
Pakistan Textile industry Seeks Policy Reversal to Boost Exports
Updated June 2,2025
Pakistan’s textile exporters are pressing the government to roll back what they describe as restrictive policies that threaten over $9 billion in value-added exports. The Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) and the Pakistan Hosiery Manufacturers and Exporters Association (PHMA) have jointly appealed to prime Minister Shehbaz Sharif for an urgent discussion.
In their letter,the associations highlighted tariff-related barriers and supply chain disruptions as critical issues needing immediate resolution. They specifically targeted changes to the Export Facilitation Scheme (EFS), arguing these have disproportionately affected small and medium-sized enterprises (SMEs). The associations are advocating for the EFS to return to its original form, ensuring stability and global competitiveness for Pakistani exporters.
The textile industry also seeks the restoration of the exporters’ final tax regime to minimize compliance costs and administrative burdens, notably for smes. They are urging the Federal Board of Revenue (FBR) to expedite sales tax and customs rebates, along with Drawback of Local Taxes and Levies (DLTL) and Duty Drawback of Taxes (DDT) reimbursements through automated systems.
To enhance competitiveness, the associations are pushing for a zero-for-zero apparel tariff agreement with the United States, aiming to reduce Pakistan’s current 29% tariffs. They warn that failure to address these issues could lead to widespread closures of export units, foreign exchange losses, and increased unemployment.
According to the exporters, global buyers now demand certified, high-performance materials, which are not readily available in Pakistan. They argue that duties and outdated regulations hinder the import of these essential raw materials,impeding the industry’s ability to meet international standards.
Dr. Ayyazuddin, PRGMEA Regional Chairman, and Abdul Hameed, PHMA Zonal Chairman, jointly emphasized the need for immediate intervention, warning that Pakistan risks missing out on global sourcing shifts. Ayyazuddin noted Pakistan’s reliance on cotton-based exports, while the majority of global apparel trade has shifted to synthetic and functional textiles.
Hameed added that duties on artificial fibers, technical yarns, performance fabrics, and critical trims—items not produced locally—are essentially “taxing exports before they even happen.”
“We cannot expand or diversify if we do not have access to the right raw materials,” Dr. Ayyazuddin said.
What’s next
The textile associations await a response from Prime Minister Sharif,hoping for swift action in the upcoming budget to address their concerns and secure the future of Pakistan’s textile industry and its crucial role in the nation’s economy.