LAHORE   -  Federal Minister for Commerce Jam Kamal Khan pledged the ministry’s full support in addressing the pressing is­sues impacting the business community during a meeting with Pakistan Busi­ness Forum (PBF) delegation.

The meeting highlighted several criti­cal challenges, including Pakistan’s dis­proportionately high electricity costs, which are hampering the country’s abili­ty to compete internationally. During the meeting, the representatives of the PBF stated that Pakistan’s electricity costs, at 20 cents per unit, far exceed those of regional competitors such as India and Bangladesh, where costs are around 4 cents per unit. The minister acknowl­edged that the high electricity tariffs have severely hindered the competitive­ness of Pakistani industries in the global market, thereby stifling export growth. “We can’t compete with the internation­al market and can’t increase exports un­less we address the issues related to cost of production,” he emphasized.

President PBF, Khawaja Mehboob ur Rehman said for decades, Pakistan’s inward-looking trade policy regime has constrained economic growth and ex­port performance. High tariffs, pervasive import bans, complex regulatory duties and extensive red-tape have led to serious distortions in the economy. These policies might have served a purpose in the past, but are now fundamentally misaligned with Pakistan’s development needs and changing global economy. There is an ur­gent need for comprehensive reform to liberalise trade, boost competitiveness and enable export-led growth.

He said Pakistan’s trade policy ap­proach has historically centred on import substitution industrialisation (ISI) and protecting the domestic industry through high tariffs and non-tariff barriers. This was rooted in a view that imports were ‘bad’ and threatened domestic produc­tion and employment. While ISI met with some early success, the policy outlived its utility as inefficiencies became en­trenched. Several factors contributed to the failed promise of import substitution industrialisation beyond the 1960s. First, the negative impacts of prolonged pro­tection – lack of competition, weak incen­tives for innovation and low productivity became more apparent over time.