Pakistan aims to abolish duties on many of the raw materials used by exporters. The goal is to make them more regionally competitive and to help the economy avoid the repeated boom-bust cycle. Discounted energy will be given to export-based factories. Devaluation and import duty cuts have strengthened Pakistan’s competitiveness, with exports projected to increase this fiscal year. More than half of Pakistan’s exports are textiles, with the industry now running close to full efficiency. The European Union, which takes about one-third of Pakistan’s exports, has extended favorable access to its markets for two more years. Pakistan’s exports to Europe grew by 30 per cent in the two years after it received favorable access in 2014, but the pace has slowed since.
Economic growth in Pakistan is seen to decelerate to 2.4 per cent in the year through June, its lowest level in more than a decade. Consumption growth accelerated and investment declined in the last fiscal year. In order to mitigate the damage done by growing deficits, Pakistan has devalued its currency by half over the last two years. Ships from the South Asian nation have been largely stagnating over the last decade, a period when other emerging nations, such as Vietnam and Bangladesh, have seen their export sectors prosper.