Exporters warn Rs55 fuel price hike could raise costs, hit Pakistan exports

Exporters and industrialists have opposed the government’s decision to increase petroleum product prices by Rs55 per litre, saying the move will raise production costs and make Pakistani exports less competitive in international markets.

Business leaders said higher fuel prices would increase transportation, energy and raw material costs for industries, adding pressure on export-oriented sectors.

Former Federation of Pakistan Chambers of Commerce and Industry (FPCCI) president Zubair Tufail said the increase could raise production costs for export industries by up to 10%.

He said global economic uncertainty is already affecting trade and warned that higher fuel prices would further strain Pakistani exporters competing in international markets.

Tufail also referred to rising geopolitical tensions involving the United States and Iran, saying the situation has already affected global shipping and logistics.

He said freight charges had doubled overnight while some insurance companies had begun withdrawing coverage for shipments, creating uncertainty for importers and exporters.

Leading exporter and former Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) chairman Ijaz Khokhar said the increase in petroleum prices would affect almost every sector of the economy, particularly industries.

He said many small and medium-sized enterprises in Sialkot provide transport facilities for workers and rising fuel costs would make these services difficult to sustain.

Khokhar added that higher fuel prices could also push up electricity and gas tariffs, further increasing industrial production costs and affecting export growth.

He warned that the decision could undermine the government’s “Uraan Pakistan” initiative aimed at expanding economic activity and exports.

Khokhar urged the government to consider a support package for exporters or adjust the rupee value to provide relief to export-oriented industries.

He said the apparel sector, as a value-added industry, could face strong pressure from rising costs, while the sports goods sector may also be affected because imported raw materials used in football manufacturing would become more expensive.

Khokhar also suggested exploring alternative sources of petroleum imports, including Russia, and reducing government expenditures to ease economic pressures.

Former Rice Exporters Association of Pakistan (REAP) chairman Rafique Suleman also opposed the fuel price increase, saying rice exports are already facing strong competition in global markets.

He said transport costs form a major component of rice exports and higher petroleum prices would further increase production costs.

Suleman called on the government to provide special relief for export-oriented industries to help them remain competitive internationally.