Govt eyes $20 billion export boost in 2024 with lower power tariff, Africa focus

ISLAMABAD: The government expects to boost exports by $20 billion in 2024, thanks to a lower power tariff for the industrial sector and a trade promotion policy focused on Africa, a minister said on Thursday.

The Special Investment Facilitation Council (SIFC), a body set up to attract foreign investment, approved a power tariff of 9 cents per unit for the industrial sector last week, down from the current 14 cents.

Dr Ejaz Gohar, minister for Commerce, Industries & Production and Investment, said the lower tariff would make Pakistani products more competitive in the global market, especially in the European Union and the United States.

“With a power tariff at 9 cents for the complete industry, we are back to exporting manufactured goods to the EU and USA, to take our share, and I believe a $20 billion increase from Jan to Dec is doable in one year's time,” Gohar told The News from Cairo, where he is leading a trade delegation.

He said the 9 cents tariff had no subsidy involved, rather it removed the cross-subsidy that the industrial sector was providing to the domestic and agriculture sectors.

Gohar said Pakistan's exports had already increased from $2.068 billion in July 2023 to $2.812 billion in December 2023, mainly due to a rise in non-textile and agriculture exports.

The exports rose by 5.2 percent to $14.981 billion in the first half of the current fiscal year 2023-24, compared with $14.244 billion in the same period of the previous year, according to official data.

The minister said Pakistan had the capacity to increase its exports to $3 billion per month, and aimed to achieve $8 billion per month through a new industry policy that would be announced soon.

"We will soon achieve our capacity and then move forward to the next step. Our goal is export-led growth, and we are going to fix the target of achieving 8 billion dollars in exports per month, which will be attained through the new industry policy," he said.

Look Africa

Gohar said Pakistan was also pursuing a "Look Africa" policy to tap into the potential of the African market.

The minister said the country aimed to increase its trade volume with Egypt, the largest Arab country and a gateway to Africa, to $4 billion, up from the current $400 million.

A delegation of 200 Pakistani companies, representing sectors such as textiles, engineering, food, agriculture, and services, was participating in the Fourth Pakistan-Africa Trade Development Conference and Fair in Cairo from Jan 9 to 11.

The companies' business sectors include textiles, engineering, food, agriculture, and services, with the aim of displaying Pakistani products and concluding potential business deals. More than 150 senior businessmen and representatives of chambers of commerce from countries in the Middle East and North Africa region are visiting Cairo to strengthen commercial relations with Pakistani businessmen.

It is worth noting that, within the framework of the “Look Africa” policy, the government of Pakistan has succeeded in organizing similar events in Johannesburg, Lagos, and Nairobi in the years 2022, 2021, and 2020, which had a positive impact in achieving greater commercial benefits.