Pakistan’s Ministry of Commerce has sanctioned 10 billion rupees ($36 million) for the textile and apparel industry and other export sectors under the Duty Drawback and Technology Upgradation Schemes, Federal Minister for Commerce Jam Kamal Khan said on Saturday, in a move aimed at easing industrial liquidity pressures and supporting export growth. Read Here
Khan announced the disbursement on social media platform X, saying the ministry had sanctioned 10,000 million rupees for textiles and apparel and other export sectors under the two schemes. He said he hoped the move would improve industry liquidity and enable exporters to expand their shipments.
The funds are expected to provide liquidity support to export-oriented industries and facilitate technological upgradation, helping exporters sharpen their competitiveness and widen their footprint in international markets, the minister said, framing the initiative as part of the government’s continued push to strengthen Pakistan’s export sectors.
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The disbursement draws on two federal support mechanisms. Duty drawback schemes — including the Duty and Tax Remission for Export (DTRE) scheme and the Duty Drawback of Local Taxes and Levies (DLTL) scheme — reimburse exporters for local taxes paid on export goods. Officials characterize these mechanisms not as subsidies but as the rightful return of duties and taxes already paid, a distinction that matters for Pakistan’s compliance posture under World Trade Organization rules on export subsidies. The Federal Board of Revenue separately maintains a registry of active manufacturers approved under the country’s export facilitation schemes, including DTRE, the broader Export Facilitation Scheme, the manufacturing bonds scheme, and the Export Oriented Unit scheme.
The sanction lands as Pakistan’s textile sector, the backbone of the country’s export economy, continues to grapple with tight liquidity, high energy costs and global demand headwinds squeezing margins across spinning, weaving and garmenting operations. Industry bodies including the All Pakistan Textile Mills Association have repeatedly pressed Islamabad to clear pending duty drawback and sales tax refund claims, arguing that delayed reimbursements tie up working capital mills need to fulfil export orders and invest in modernization.
Pakistan’s textile and apparel exports remain the largest single contributor to the country’s foreign exchange earnings, and the sector has been a recurring focus of government support measures amid persistent balance-of-payments strain. The ministry’s statement did not specify a disbursement timeline or break down how the funds will be allocated between the duty drawback and technology upgradation components, and industry representatives have previously called for greater transparency in the release of such support.