Exporters seek removal of power cross-subsidy, roadmap for Rs327 billion refunds

Exporters have urged the government to remove the cross-subsidy from industrial power tariffs and announce a roadmap for clearing outstanding refunds of Rs327 billion, a week after the passage of the federal budget 2026-27.

The demands were raised during a meeting with Minister of State for Finance Bilal Kayani, who has been tasked by Prime Minister Shehbaz Sharif with resolving pending issues of the export sector.

The exporters’ delegation included Khurram Mukhtar, Patron-in-Chief of the Pakistan Textile Exporters Association, Javed Bilwani, former president of the Karachi Chamber of Commerce and Industry, Syed Ahtisham, President of the Sialkot Chamber of Commerce and Industry, Rana Imran, Jamshed Murtaza, Zubair Motiwala, former president of KCCI, and Aslam Pakhali, CEO of FA International.

According to an official announcement, the delegation again called for the removal of the cross-subsidy from the B3/B4 industrial power tariff, a matter earlier taken up in the industry’s meeting with the prime minister.

Exporters said the cross-subsidy had increased energy costs and affected the competitiveness of export-oriented industries.

The delegation said power is among the largest conversion costs for the textile sector, and any reduction in energy costs would support exporters in meeting and surpassing the FY27 export target.

It was also pointed out that most B3 and B4 mills are export-oriented, and resolving the voltage-related tariff anomaly would directly support the export sector.

The exporters also raised the issue of pending refunds, including deferred sales tax, duty drawback, income tax, DLTL and Technology Upgradation Fund claims.

They urged the authorities to speed up payments to ease liquidity pressure on exporters. The sales tax refund threshold for commercial SME exporters was also discussed, with the delegation seeking relief for smaller exporters.

In response, the Federal Board of Revenue agreed to notify committees to examine the taxation issues raised by the delegation.

Follow-up meetings on energy tariffs and other unresolved matters are expected in the coming days.

The delegation was assured that the government would take steps to facilitate exporters and address their concerns on a priority basis.

Business representatives also shared proposals for improving ease of doing business, operational efficiency and Pakistan’s export competitiveness.