Key Takeaways
- PHMA calls for 6-8% export support to mitigate rising costs.
- Exporters face financial pressures and potential loss of market share.
- Key issues include high electricity tariffs and increased ocean freight charges.
The Pakistan Hosiery Manufacturers & Exporters Association (PHMA) has urged the federal government to provide temporary export support to protect the country’s hosiery, knitwear, and apparel industry from mounting financial pressures. At a consultative meeting with the Ministry of Commerce, PHMA Central Chairman Syed Zia Alamdar Hussain highlighted the urgent need for support to retain international buyers and prevent further erosion of Pakistan’s market share.
Hussain proposed a temporary Duty Drawback of Local Taxes and Levies (DLTL) support of 6-8 percent of the Free-on-Board (FOB) value on a shipment basis for a limited period. This relief is aimed at helping exporters absorb exceptional cost increases and maintain their competitiveness in global markets.
The PHMA chairman stressed the financial difficulties faced by exporters, noting that manufacturers must pay for raw materials, labour, and other production expenses well before receiving payments for their exports. He called for affordable working capital and uniform implementation of the announced 4.5 percent Export Financing Scheme (EFS) end-user rate, applicable until June 2027.
Hussain also objected to the abrupt imposition of government levies, stating that exporters could not pass these additional costs on to international buyers. He pointed out that provincial holidays also disrupt export production and increase costs, urging that export-oriented industries be allowed to observe only the holidays notified in the federal gazette.
High electricity and gas tariffs, power outages, federal and provincial taxes, energy cross-subsidies, rising labour costs, delayed tax refunds, and higher regulatory compliance expenses are identified as major factors driving up manufacturing costs. The sharp rise in ocean freight charges has further weakened Pakistan’s competitive position, with rates to some major destinations increasing by 1.5 to 2.5 times their previous levels.
The PHMA warned that competition among regional sourcing destinations is intensifying, as international buyers consider not only prices but also supply reliability, delivery schedules, and the overall business environment when placing orders. Exporters are increasingly being forced to absorb additional expenses at the cost of their already narrow profit margins or pass them on to foreign buyers, making Pakistani products less competitive against those sourced from regional countries.
Syed Zia Alamdar Hussain highlighted that exports are a federal subject and called for coordinated policy measures to ease the burden on exporters, improve their competitiveness, and protect the industry from further losses. The PHMA’s proposals are aimed at mitigating the impact of rising costs and ensuring the sustainability of Pakistan’s export-oriented industries.
The proposed relief would help exporters absorb exceptional cost increases, retain existing international buyers, fulfil ongoing orders and prevent further erosion of Pakistan’s share in global markets.
Syed Zia Alamdar Hussain, PHMA Central Chairman
