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The federal government has issued a statutory regulatory order to eliminate the 0.25 percent customs duty previously charged under the Export Development Surcharge, a decision expected to deliver meaningful financial relief to Pakistan’s struggling export sector.
The surcharge, originally introduced in 1991, applied to all exportable goods and had long been criticized for adding avoidable costs at a time when Pakistan’s exporters face intense global competition.
The move comes amid persistent pressure from exporters and industry bodies. Many argued that the surcharge eroded competitiveness, reduced liquidity and made compliance more difficult. Industry groups have welcomed the latest development as overdue support for a sector grappling with falling shipments and rising operational expenses.
According to officials, the SRO was issued after receiving formal cabinet approval. A senior government representative leading the working group on export reforms said the decision marks a significant step toward easing the financial burden on exporters.
SRO to exempt exports from Export Development Surcharge has been issued after cabinet approval. Will bring relief to export sector for which I would like to thank the PM for approving the recommendations of the working group chaired by me and for a prompt action. @PakTexCouncil… pic.twitter.com/VGT6f5w1Pf
— Musadaq Zulqarnain (@MusadaqZ) December 2, 2025
Recent data underscores the urgency: exports from July to November 2025 fell by 6 percent, with November alone recording a sharp 15 percent year-on-year decline. Reducing costs through regulatory streamlining is expected to help stabilize export revenues and strengthen the viability of export-oriented businesses.
Analysts say the end of the surcharge aligns with broader national goals to revive export-led growth, simplify procedures and remove barriers that impede trade performance. By lowering costs, the government hopes to boost competitiveness, encourage formal trade channels and support industries amid challenging global economic conditions.
However, some experts caution that the surcharge previously funded export-promotion initiatives. They recommend that the government put alternative funding arrangements in place to ensure these programs continue without disruption.
Even so, the broader business community views the SRO as a timely step toward revitalizing Pakistan’s export landscape, offering necessary relief at a critical moment for the economy.
