The federal government of Pakistan has approved a massive Rs98 Billion subsidy package to provide subsidized loans to local exporters, including financing at a fixed five percent rate for up to a decade.
The strategic financial intervention has arrived after national exports contracted by six percent during the previous fiscal year despite prior state incentives.
Headed by Finance Minister Muhammad Aurangzeb, the Economic Coordination Committee (ECC) cleared three central bank-recommended schemes for the current fiscal year. The schemes include the enhancement of Exim-administered Export Finance Scheme (E-EFS), the newly launched Long-Term Export Growth Financing Facility (LTEGFF), and the scheme for Performance based Rebate on Incremental Exports.
Under the Exim-administered Export Finance Scheme (E-EFS), authorities could provide six-month working capital loans at an 8.5 percent rate by absorbing a five percent interest cost, requiring an immediate Rs58 billion subsidy.
Furthermore, the committee expanded the short-term portfolio limit from one trillion rupees to 1.5 trillion rupees.
The administration also launched the new Long-Term Export Growth Financing Facility (LTEGFF) to support export-oriented projects and industrial modernization. The facility will offer concessional loans at a two percent rate for two years followed by a fixed five percent rate for the subsequent eight years, targeting a projected Rs350 billion in disbursements.
Additionally, authorities approved a performance-based rebate scheme effective from July 1, 2026, allocating an estimated Rs15 billion annually. Exporters achieving up to 10 percent annual growth will receive a one percent rebate on incremental export value, while higher growth earners qualify for a two percent return.
