Key takeaways
- Pakistan's export-to-GDP ratio has fallen to about 10%, against an estimated 25% potential.
- IT exports reached about US$3.5 billion; Bangladesh exports over US$50 billion.
- Digital services depend on skills and predictable rules more than energy or land.
- Anti-export bias in tariffs and indirect taxes raises input costs.
- The need is coherence, not a big industrial policy or large subsidies.
In this Minute Mirror column (December 2025), Dr. Ghulam Mohey-ud-din argues that Pakistan’s recent stabilisation will not last unless growth shifts from consumption to exports, and that digital services are the most realistic place to start.
The argument
Low inflation, a budget surplus and better sovereign risk ratings are welcome, but they are temporary without a change in how Pakistan earns foreign exchange. The column puts the export-to-GDP ratio at roughly 10 percent, well below regional peers and an estimated potential of 25 percent. Bangladesh, which pursued consistent export policy, now exports more than US$50 billion a year.
IT and freelancing stand out because they are capital-light. They depend on skills, connectivity and regulatory predictability rather than cheap energy or large industrial land, and they already earned about US$3.5 billion in the previous year. Their growth is held back by an anti-export bias in the tariff structure, duties and indirect taxes that raise input costs, and by fragmented provincial sales taxes and labour levies that add compliance burden.
The National Tariff Policy 2025-30 is progress, and institutions such as the Special Investment Facilitation Council and Pakistan Single Window show that coordinated, rules-based governance is possible. What is missing is consistent execution.
What needs to change
- A final, explicit tax on export revenue instead of profit-based overlays, for planning certainty.
- Exemption of capital gains on technology investment to support start-ups.
- One-return coordination of provincial sales taxes through the National Tax Council.
- A single online portal for labour levies.
- Permanent foreign-exchange retention rules for exporters.
As the column puts it, Pakistan does not need a grand industrial policy or expensive subsidies; it needs coherence.