PHMA cautions govt against putting pressure on exporters

LAHORE: The Pakistan Hosiery Manufacturers and Exporters Association (PHMA) has urged the government to reconsider its policy of linking export rebates to incremental growth targets, warning that exporters should not be penalized for failing to post higher year-on-year growth due to domestic and global factors beyond their control.

PHMA North Zone Chairman Abdul Hameed said the export-oriented industry fully supported the government’s objective of increasing exports, but cautioned that making rebate eligibility conditional on incremental growth could place additional pressure on exporters already facing severe challenges.

He said the rebate mechanism should be designed as a support measure to improve competitiveness rather than function as a penalty-based system.

Exporters, he added, were currently operating under difficult conditions due to high electricity and gas tariffs, elevated interest and markup rates, rising production costs, liquidity constraints, taxation pressures, delayed refunds and frequent changes in industrial and export policies.

PRGMEA Zonal Chairman Imran Salahuddin said the government’s export rebate policy should be structured in a manner that supported exporters facing genuine economic and market challenges.

PRGMEA former Chairman Ijaz Khokhar said Pakistan’s export sector could not achieve sustainable growth unless the government addressed the fundamental issues affecting the cost of production and the ease of doing business.

PHMA former Chairman Shahzad Azam Khan said the rebate mechanism should recognize the difficult conditions under which exporters were operating and should not create uncertainty for businesses. He said export incentives were intended to strengthen Pakistan’s competitiveness and should therefore be made transparent, predictable and accessible to genuine exporters.

PHMA former Chairman Naseer Ahmad Butt said the government needed to protect the competitiveness of Pakistan’s value-added textile and hosiery sector, which provided employment to a large number of people and contributed significantly to the country’s exports.

He said linking rebates solely to incremental growth could discourage exporters during periods of weak international demand.

PHMA Sialkot Vice Chairman Tariq Mahmood Bhatti said exporters needed a stable business environment and consistent government policies to make long-term investment and expansion decisions. He said frequent policy changes, rising production costs and liquidity constraints were affecting the ability of exporters to compete globally, and he supported a proposal for a two-tier rebate mechanism under which exporters would receive basic support while additional incentives would be provided for genuine incremental export performance.

PHMA former Vice Chairman Khawaja Musharraf Iqbal said Pakistan’s export growth depended on improving productivity, reducing the cost of doing business and strengthening the competitiveness of export-oriented industries. He said the government should engage with trade bodies before implementing major changes in export incentive policies.

Abdul Hameed said export performance was also being affected by international factors, including weak global demand, intense competition, geopolitical uncertainty, higher freight and logistics costs and changing buying patterns.

These factors, he said, were beyond the control of individual exporters, making it unfair to withdraw or recover rebates simply because exports did not exceed the previous year’s level.

He said the government’s performance-based rebate scheme, under which exporters achieving annual growth of up to 10 percent over the preceding year would qualify for a rebate of one percent of incremental export value, while those achieving growth above 10 percent would receive a two percent rebate, was aimed at encouraging export expansion.

However, he said the policy needed to be reviewed to ensure it did not unintentionally penalize genuine exporters facing difficult market conditions.

The PHMA leader said the government should instead provide a predictable and transparent rebate framework under which eligible exporters could continue receiving basic support, while additional incentives could be offered to those achieving higher export growth.

He proposed that the rebate system have two components: a basic rebate available to eligible exporters to offset structural cost disadvantages, and an additional performance incentive for those achieving genuine incremental growth.

Copyright Business Recorder, 2026