Key Takeaways
- The Pakistan Textile Council (PTC) has written to Prime Minister Shehbaz Sharif urging retention of the Export Facilitation Scheme (EFS) for yarns and fabrics.
- The council warns that further exclusions could harm Pakistan’s value-added textile exports and international market competitiveness.
- PTC highlights the importance of man-made fibre (MMF) in global trade and the risks of excluding these inputs from the EFS.
The Pakistan Textile Council (PTC) has formally requested Prime Minister Shehbaz Sharif to maintain the Export Facilitation Scheme (EFS) for all legitimate export inputs, including yarns and fabrics, according to a letter sent to the prime minister. The council, led by Fawad Anwar, has expressed concern over demands to exclude yarns and fabrics under Chapters 52 and 55 of the Pakistan Customs Tariff from the scheme.
Anwar stated in the letter that accepting these demands would cause serious and lasting harm to Pakistan’s value-added exports. The PTC has previously removed raw cotton, cotton yarn, and grey cloth from the scheme in 2025 through SRO 1359(I)/2025, but now warns that further exclusions could undermine the competitiveness of the sector.
The council cited a Textile Exchange report, which found that synthetic fibres accounted for 69 percent of global fibre production in 2024, while cotton’s share was 19 percent. Man-made fibre (MMF)-based products account for around 63 percent of global textile and apparel trade, compared with approximately 12 percent of Pakistan’s exports.
PTC noted that competing countries, such as Bangladesh, are expanding their presence in the MMF segment. Bangladesh aims to increase the share of MMF in its apparel exports from around 24 percent to 40 percent by 2030. Pakistan, on the other hand, has almost no domestic viscose or lyocell fibre production and faces cost and scale disadvantages in its polyester value chain compared to Chinese and ASEAN producers.
The PTC warned that the 2025 exclusions had already forced exporters to pay taxes upfront on affected inputs, increasing liquidity pressures and production costs. Further restrictions could raise input costs, tie up working capital, and discourage investment in value-added and MMF-based production capacity.
The council also cautioned that the proposed exclusions could weaken international buyers’ confidence in Pakistan as a reliable sourcing destination. However, the PTC backed strict action against misdeclaration, under-invoicing, and diversion of imports into the domestic market. It stated that the Federal Board of Revenue (FBR) and Pakistan Customs have the legal powers, systems, and personnel to identify and prosecute offenders.
Anwar emphasized, 'The misuse of a few cannot justify penalising genuine exporters or dismantling a scheme that is central to export competitiveness.' The PTC urged the prime minister to ensure that the EFS remains available for all legitimate exporters.
The PTC’s letter to the prime minister was also sent to the FBR chairman and the secretary of commerce, underscoring the importance of the EFS for the textile industry. The council’s efforts reflect a broader concern among industry leaders about the potential negative impacts of further exclusions on Pakistan’s export competitiveness.
Accepting these demands would cause serious and lasting harm to Pakistan’s value-added exports.
Fawad Anwar, PTC Chairman
The misuse of a few cannot justify penalising genuine exporters or dismantling a scheme that is central to export competitiveness.
Fawad Anwar, PTC Chairman
