New export support welcomed: PTC seeks to quell concerns over India-EU trade deal

ISLAMABAD: The Pakistan Textile Council (PTC) on Sunday moved to quell concerns regarding the recently concluded India–EU Free Trade Agreement, urging policymakers to focus on national strengths, stating that “competitiveness—not fear—should guide policy.”

Addressing the issue, PTC Chairman Fawad Anwar cautioned that the perceived threat to Pakistan’s European Union exports is being overstated by some groups, including those who have historically promoted policies detrimental to value-added exports.

He noted that while competition may intensify when the agreement becomes effective next year, Pakistan’s premier exporters, particularly in value-added textiles and apparel, are well-equipped to compete due to their established reputation for quality, compliance, sustainability standards, and long-standing relationships with buyers.

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However, the PTC lauded the recent decrease in Export Refinance Facility (ERF) rates, a move achieved without imposing any new fiscal burden. It praised the State Bank of Pakistan for devising a framework where a one percent cut in the Cash Reserve Requirement (CRR) released over Rs 300 billion of liquidity into the banking system. This enabled financial institutions to absorb the 300-basis points reduction in ERF rates while preserving their stability and profitability.

“This approach strengthens market liquidity, lowers the cost of financing for exporters, and maintains confidence in the banking system—an outcome that reflects close coordination between fiscal and monetary authorities,” Anwar added.

Furthermore, the council welcomed the Prime Minister’s announcement to eliminate cross-subsidies from industrial power tariffs. It termed the decision a “long-overdue correction” of structural distortions that have disproportionately penalised export-oriented sectors and a clear signal of a shift toward targeted, export-led growth.

The council reaffirmed its commitment to collaborating with the government to transform macroeconomic stability into sustained export growth, job creation, and increased foreign exchange earnings for the country.