Pakistan’s Unrealistic Export Targets Highlight Lack of Solid Strategy

The trade ministry’s ambitious plan to nearly double Pakistan’s exports to $60 billion over the next three years has been widely criticized as wishful thinking. This new target starkly contrasts with the IMF’s more conservative projection of a 22% rise to $37.2 billion over the same period.

Achieving such a dramatic increase in exports would require Pakistan to consistently grow its foreign sales by nearly 25-30% annually. This level of growth demands vast private investments in both industry and agriculture to enhance productivity and diversify exports. However, there is no evidence to suggest that such investments are forthcoming in the near future.

Historically, Pakistan’s exports have shown marginal gains in dollar value primarily during global commodity super cycles. The country’s exports are marked by plummeting quantities and a decreasing global market share, posing a significant challenge to sustainable economic growth. Exporters often cite high energy prices, demand fluctuations, and domestic policy shifts as reasons for poor performance, despite benefiting from significant subsidies and tax rebates.

The exporters’ failure to diversify their products, improve productivity, upgrade technology, explore new markets, and move up the value-addition ladder is equally responsible for Pakistan’s chronic export challenges. The stagnant export-to-GDP ratio is a major factor contributing to the current economic slowdown and balance-of-payments crisis.

To bridge its trade deficit and finance growth, Pakistan needs to increase exports. However, setting ambitious targets without a solid plan to boost investment and productivity is unlikely to yield the desired results. Without concrete steps and realistic strategies, the goal of doubling export earnings will remain an elusive dream, much like previous targets that aimed to raise export revenues to $100 billion.