Pakistan’s widening trade deficit requires an immediate and comprehensive strategy focused on increasing exports, strengthening domestic production and managing imports effectively, according to United Business Group (UBG) President and former FPCCI President Zubair Tufail.
Zubair Tufail expressed concern over Pakistan’s trade deficit reaching $10.8 billion during the first quarter of the current fiscal year, saying that the rapid increase in imports continues to pose a challenge to the country’s trade balance.
He noted that exports recorded a significant year-on-year increase in September 2026, with exports reaching $2.94 billion, according to the Pakistan Bureau of Statistics. However, he stressed that stronger export growth is needed to address the widening trade gap on a sustainable basis.
Zubair Tufail Calls for Export Growth
Zubair Tufail urged the government to adopt an immediate strategy aimed at expanding Pakistan’s export base while effectively managing the import bill.
He warned that a persistently widening trade deficit could increase pressure on the country’s foreign exchange reserves and external payment obligations. He emphasized that increasing exports should therefore remain a major priority for economic policymakers.
According to him, Pakistan needs policies that support productive sectors and enable businesses to compete more effectively in international markets.
Lower Production Costs for Export Industries
Zubair Tufail called for reductions in electricity, gas and other production costs to improve the competitiveness of export-oriented industries.
He also urged the government to facilitate the import of industrial raw materials and essential machinery required by productive sectors.
Timely payment of refunds to exporters was another area he highlighted, saying that efficient refund mechanisms are important for businesses involved in international trade.
Lower production costs, access to necessary industrial inputs and timely refunds, according to his proposal, would help create a more supportive environment for exporters.
Pakistan Needs Broader Export Base
Zubair Tufail stressed that Pakistan’s export growth should not remain concentrated in textiles alone.
He called for greater attention to sectors including:
- Information technology
- Engineering
- Pharmaceuticals
- Rice
- Leather
- Sports goods
- Surgical instruments
- Other value-added industries
He said expanding exports across a wider range of sectors would help Pakistan develop a stronger and more diversified export base.
Government Role in Export Promotion
Zubair Tufail said the responsibility for increasing exports should not rest solely with exporters.
He called for a more active government role in promoting Pakistani products internationally through trade delegations and effective international marketing initiatives.
He also proposed that commercial counsellors posted at Pakistani embassies and consulates abroad should be given clear export-promotion targets.
According to him, these officials should also work toward facilitating greater access for Pakistani businesses to local markets in the countries where they are posted.
Zubair Tufail Proposes Export Growth Roadmap
To address the trade deficit, Zubair Tufail proposed that the government, State Bank of Pakistan and private sector jointly formulate a clear and practical “Export Growth Roadmap.”
He said the roadmap should prioritize long-term incentives for exporters, investment in productive sectors, domestic production of industrial raw materials and the development of import-substitution industries.
The objective would be to strengthen domestic productive capacity while creating greater opportunities for Pakistani businesses to compete in international markets.
Focus on Industrial Raw Materials and Import Substitution
Zubair Tufail emphasized the importance of developing industries that can produce industrial raw materials domestically.
He said Pakistan should prioritize import-substitution industries rather than relying excessively on imported inputs that could potentially be produced locally.
At the same time, he argued against unnecessary restrictions on imports, saying that productive and industrial inputs should continue to be imported where required.
He proposed discouraging non-essential and low-priority imports while ensuring that industries have access to the machinery and raw materials necessary for production and exports.
IT and Digital Exports Can Support Trade Balance
In addition to merchandise exports, Zubair Tufail highlighted the importance of increasing Pakistan’s earnings from services.
He particularly emphasized IT and digital exports, saying that higher earnings from these sectors could partially offset the deficit in merchandise trade.
Greater growth in services exports, combined with stronger performance in goods exports, could contribute to efforts to reduce the trade deficit over the longer term.
Pakistan Needs Sustainable Export Growth
The increase in Pakistan’s exports during September indicates potential for further expansion, according to Zubair Tufail. However, he stressed that export growth needs to be supported by policies that address production costs, industrial capacity, market access and investment.
His proposed approach combines export promotion with domestic production of industrial raw materials and the development of import-substitution industries.
Zubair Tufail said a coordinated strategy involving the government, State Bank of Pakistan and private sector would be necessary to strengthen Pakistan’s export capacity and move toward a more sustainable reduction in the trade deficit.
