By SKM
January 8, 2026
ISLAMABAD: Pakistan’s trade deficit is on track to surge to $40 billion by the end of the current fiscal year as exports continue to lag and production costs remain high, Chairman of the All Pakistan Textile Mills Association (APTMA) Kamran Arshad warned on Wednesday.
He said the country has already posted a trade deficit of over $19 billion in the first half of the fiscal year, underscoring mounting pressure on the external account and raising concerns over economic sustainability.
Arshad stressed that the absence of a long-term trade and industrial policy, coupled with rising input costs, is eroding Pakistan’s export competitiveness. He identified high electricity tariffs as the single biggest challenge facing exporters, particularly the textile sector, which accounts for the bulk of the country’s foreign exchange earnings.
“Pakistan cannot compete with countries like Bangladesh and Vietnam unless the cost of doing business is brought down,” he said, adding that energy prices in competing economies are significantly lower.
Clarifying the industry’s stance, Arshad said exporters are not seeking subsidies, but are demanding a reduction in electricity tariffs to 8 cents per unit, which he termed critical for sustaining export growth and preventing further industrial decline. He warned that continued high power costs could lead to factory closures and job losses.
The APTMA chairman also expressed concern over Pakistan’s increasing dependence on external borrowing instead of export-led growth, warning that the ballooning debt burden poses a serious threat to economic sovereignty.
Calling for urgent structural reforms, he said Pakistan must move toward self-reliance and reduce its repeated dependence on International Monetary Fund (IMF) programs. “The only durable way out of the IMF cycle is through exports,” he said, stressing that exports must be at least double remittances to stabilize the economy.
Arshad urged the government to take immediate policy action to lower energy costs, provide a predictable business environment, and implement consistent long-term measures to revive exports and contain the widening trade deficit. Ends
