ISLAMABAD: The federal government has decided to continue the Export Facilitation Scheme (EFS) to support Pakistan’s exports while introducing measures to prevent its misuse and protect domestic industries, Minister of State for Finance Bilal Azhar Kayani told the National Assembly on Tuesday.
Responding to a point of order raised by MNA Sharmila Faruqui, Kayani said the scheme remained essential for increasing the country’s exports and that the government had no intention of discontinuing it or unnecessarily restricting the facilities available to exporters.
He said corrective measures had been introduced following reports of irregularities and misuse of the scheme, particularly concerns that duty-free imported raw materials could be diverted to the domestic market, potentially harming local manufacturers.
The minister assured lawmakers that the government was working to address these concerns while ensuring that exporters continued to have access to quality raw materials at competitive prices.
Government moves to prevent misuse of duty-free imports
Explaining the scheme’s importance, Kayani said the Export Facilitation Scheme allows exporters to import raw materials and other inputs required for manufacturing export products without paying customs duties.
The facility is designed to reduce production costs, improve competitiveness and help Pakistani exporters compete more effectively in international markets.
However, the minister acknowledged that instances of irregularities and misuse had emerged under the scheme in the past, prompting the government to introduce corrective measures.
He said the reforms were intended to minimise the possibility of future violations and ensure that duty-free imports were used for their intended purpose.
Kayani clarified that the government’s objective was not to withdraw export incentives but to strengthen transparency and prevent practices that could disadvantage domestic manufacturers.
Textile industry concerns under government review
The minister said the government was maintaining regular consultations with business representatives, exporters and stakeholders across Pakistan’s textile value chain to address concerns surrounding the scheme.
He specifically referred to engagement with the All Pakistan Textile Mills Association (APTMA), local loom operators, garment manufacturers and other relevant industry representatives.
According to Kayani, these consultations are aimed at examining challenges faced by different segments of the textile industry and developing measures that balance the interests of exporters with those of domestic producers.
He said particular attention was being given to preventing the sale of duty-free imported raw materials in the local market, a practice that could undermine domestic industries.
The government was taking steps to ensure that raw materials imported under the scheme were not diverted into domestic trade in ways that could harm local manufacturers, he added.
Export incentives to remain intact
Kayani reiterated that the government remained committed to facilitating exporters by ensuring continued access to raw materials of the required quality at reasonable prices.
He said maintaining these facilities was necessary to support export growth while addressing legitimate concerns raised by domestic industries.
The minister also acknowledged that the Export Facilitation Scheme had been the subject of public and media discussion, adding that the government was continuously engaging with stakeholders to assess its impact across the production and export value chain.
Although the issue was not formally included in the National Assembly’s agenda or raised through a calling-attention notice during Question Hour, Kayani said Sharmila Faruqui had highlighted an important matter that required clarification.
He maintained that the government’s approach was to preserve the scheme’s benefits for exporters while strengthening safeguards against misuse and ensuring fair treatment of local industries.
The minister said the government would continue working with industry stakeholders to resolve outstanding concerns and support the growth of Pakistan’s export sector.