PRIME Minister Shehbaz Sharif’s emphasis on export-led growth and his consultations with the industrialists and business leaders in this regard are welcome steps. His direction to review the extension of super tax exemption for exporters, address business-related issues and improve the ease of doing business shows that the government recognizes the importance of a vibrant private sector in strengthening the economy.
Yet, there is a familiar ring to these promises. One has been hearing about export-led growth for years, with successive governments repeatedly declaring exports a national priority. Unfortunately, the results remain far from encouraging. Instead of achieving a sustained expansion, the country’s export performance has struggled and, in fact, exports have actually shrunk. The government has taken some positive measures in the latest budget to facilitate businesses, improve access to finance etc.. Efforts to digitize the FBR and simplify regulations are also steps in the right direction. But these initiatives will have limited impact if the fundamental cost of doing business remains high.
Energy costs are perhaps the biggest obstacle. Petroleum prices remain on the higher side, while electricity and gas tariffs continue to put enormous pressure on industries. Pakistani exporters cannot compete in international markets when their production and transportation costs are significantly higher than those of competitors. Any serious export strategy must therefore include meaningful and sustainable relief on fuel and energy prices. At the same time, we must stop relying excessively on a narrow range of traditional exports. The future lies in diversification, innovation and value addition. Textiles, agriculture and other traditional sectors need to move up the value chain, while emerging areas such as information technology, telecommunications, digital infrastructure and artificial intelligence deserve greater attention. There is a need to going beyond making declaration to taking practical steps that make our exports competitive and sustainable. Only then can the promise of export-led growth finally become a reality.
