Govt eliminates duties on 4,000 tariff lines

Major trade reform
islamabad
Finance Minister Muhammad Aurangzeb confirmed that the federal government had eliminated additional customs duties on 4,000 out of 7,000 tariff lines, while reducing duties on a further 2,700.
In a post-budget press briefing on Wednesday, FinMin Aurangzeb outlined a comprehensive tariff reform plan, aimed at driving industrial growth and boosting exports in a bid to transition the country towards a more globally integrated economy.
He called the tariff rationalisation a “major and important step” in aligning Pakistan’s trade and industrial policy with international standards.
“This is a structural reform that hasn’t been undertaken in the past 30 years,” said Aurangzeb. “From a reform perspective, this is a huge step, and we’re committed to taking it forward gradually.”
The tariff reform, part of Pakistan’s broader economic restructuring plan, includes significant reductions in duties on raw materials and intermediary goods used by exporters.
Aurangzeb said that the move was designed to reduce input costs, thereby improving Pakistan’s competitiveness in international markets.
Focus on Industrial Growth and Exports
Pakistan’s trade and industrial sectors have long been weighed down by high tariffs and protectionist policies. The finance minister stated that this shift away from import substitution was essential to address Pakistan’s recurring balance of payments crises and the pressures of dollar liquidity.
“If we want to structurally reposition the country toward export-led growth, we need to change the very DNA of the economy,” Aurangzeb explained. “That’s how we avoid falling into the same cycle of dollar shortages every time we try to grow.”
The minister also highlighted that the reductions in tariff duties would specifically benefit Pakistan’s industrial and export sectors, noting that approximately 2,000 tariff lines were linked to key raw materials and intermediary goods. The government’s broader goal is to streamline the tariff structure to support industrial growth and integrate the economy more deeply into global supply chains.
Fiscal Measures and Support for Key Sectors
Aurangzeb also outlined the government’s fiscal measures designed to balance economic growth with equity, focusing on relief for salaried individuals and mid-sized businesses. He stated that the government had tried to offer as much relief as possible within the constraints of available fiscal space.
“The government has carefully considered different slabs, including at the highest levels, to provide as much relief as fiscal space allows,” he said.
In terms of support for key sectors, Aurangzeb mentioned that the government is prioritising construction and agriculture. Reforms in these sectors are aimed at lowering transaction costs, supporting affordable housing, and ensuring greater access to credit for small farmers.
The finance minister also revealed plans to launch a new housing finance scheme in collaboration with the State Bank of Pakistan, aimed at making mortgage financing more accessible for citizens.