Karachi, May 21, 2025 – The Karachi Chamber of Commerce and Industry (KCCI) has strongly called for the restoration of zero-rated sales tax under the Export Facilitation Scheme (EFS) to support the local textile industry, particularly for the procurement of raw materials and yarn.
In a detailed statement issued on Wednesday, KCCI President Jawed Bilwani emphasized that EFS is playing a crucial role in enhancing Pakistan’s export competitiveness, especially in the value-added textile segment. He stressed that the scheme must be further simplified and strengthened to unlock its full potential.
“The EFS has proven to be a game-changer for Pakistan’s export sector,” said Bilwani. “Countries like Bangladesh and Vietnam have seen rapid growth in exports primarily due to facilitation schemes similar to EFS. We must adopt the same aggressive approach to remain competitive globally.”
Bilwani noted that the EFS has not only helped increase exports of traditional textile products but has also opened avenues for exporting materials and fabrics that are not manufactured locally. He pointed out that due to the high quality of yarn and fabric allowed under the EFS, global buyers are now showing increased interest in sourcing from Pakistan.
The KCCI president urged the government to restore zero-rated sales tax on local purchases of yarn and raw materials under the EFS, as was previously allowed. He argued that this step would significantly reduce production costs and improve the sector’s overall efficiency.
“Despite Pakistan facing the highest utility and interest rates in the region, exports have continued to rise, largely due to the EFS,” Bilwani stated. He further added that the introduction of real-time audit systems under EFS would enhance transparency and build confidence among exporters.
Highlighting the broader impact of the scheme, Bilwani said that EFS has the capacity to attract new sectors into the export fold and could play a pivotal role in reducing the country’s trade deficit. However, he warned that to achieve these benefits, the government must implement the scheme in its true spirit without delays or bureaucratic hurdles.
KCCI reaffirmed its commitment to work closely with policymakers to ensure that EFS becomes a cornerstone of Pakistan’s long-term export strategy.