Why our exports are stuck, what to do about it

2026-02-16 - 00:36

In the 1990s, Pakistan exported the equivalent of 16 percent of GDP. By 2023–24, that ratio had fallen to 10 percent. In absolute terms, Pakistan exported $39.5 billion worth of goods and services in 2022. In FY2024–25, exports slipped to $32.1 billion. Now compare. Vietnam exports the equivalent of 86 percent of its GDP. Pakistan exports just 10 percent. In 1990, Vietnam exported $2.4 billion. By 2024, that figure had exploded to $429 billion. Pakistan, meanwhile, moved from roughly $5 billion in 1990 to $32 billion today. Three decades. Two countries. Vietnam chose exports as a growth engine. Pakistan let exports become an afterthought. Why are Pakistan’s exports stuck? To begin with, Pakistan has an anti-export tax wedge. Yes, exports fail because costs are unpredictable and punitive. Five mountains Pakistani exporters up against: unpredictable energy prices, delayed tax refunds, FX distortions and hidden levies embedded in utilities and logistics Why are Pakistan’s exports stuck? Pakistan sells products. Vietnam sells assurance. Vietnam provides state-backed export credit and insurance. Vietnam underwrites multi-year supply contracts. Pakistan sells products – bedsheets and rice. Pakistan sells products; Vietnam is part of a global supply chain. Why are Pakistan’s exports stuck—and what to do about it. Establish a National Export Cost Authority (NECA) – remove the anti-export tax wedge. NECA must do three things: One-set export-energy tariffs at regional parity. Two-audit and eliminate implicit export taxes including FX, utilities, and levies. Three-enforce automatic, time-bound tax refunds. Ministries protect revenue. Exports need NECA – a counterweight. Why are Pakistan’s exports stuck—and what to do about it. Establish an Export Contracts & Credit Authority (ECCA). ECCA must do three things: One-provide state-backed export credit and insurance. Two-underwrite multi-year supply contracts. Three-de-risk large foreign buyers for Pakistani exporters. Pakistan sells bedsheets and rice. Vietnam sells reliability. Pakistan must shift from spot sales to long-term contracts. Pakistan must sell assurances. Red alert: Pakistani exporters have a permanent cost wedge. Pakistani exporters finance the state before they finance production. Vietnam did the opposite. It priced energy competitively, refunded taxes automatically, and removed uncertainty from cost structures. Remember, exports respond to arithmetic, not speeches. Pakistan has no institutional owner of exports. Yes, everyone speaks for exports. But, no one is accountable for them. This must change. Vietnam did not just cut costs and sell contracts. It collapsed turnaround time – at ports, in customs, at borders and in clearance. In today’s Pakistan, three things are happening: containers are sitting, clearances stall and borders choke. Remember, supply chains don’t forgive delays. Remember, exports don’t die in factories – they die between factory and ship. Vietnam did just three things: digitised customs, enforced turnaround clocks, and unified port, rail and border clearance. All that Pakistan has done is added forms. Pakistan does not lack exporters – it burdens them. Exports will rise – not by hope, but by design. Three things: fix costs, sell assurance and deliver on time. —The writer is a journalist and political analyst.