Govt introduces Rs3bn SME Risk Pool to power export-led growth

Pakistan's government has introduced a Rs3 billion SME Risk Pool through the Export Development Fund, alongside a reinsurance deal with the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), according to Mettis Global. Federal Minister for Finance and Revenue Muhammad Aurangzeb termed the launch a major step toward export-led growth, describing the measures as practical tools rather than mere goals. The agreements were signed at a ceremony held under EXIM Bank's auspices.

According to the minister, the economy grew around 3.7% in the last fiscal year against a target above 4% for the current one, and exports and private investment must now drive expansion. He said exporters can now borrow at 4.5%, while a dedicated SME allocation will support subsidised financing for businesses supplying larger exporters. The budget also cut super tax to zero for companies exporting over 80% of production and abolished advance tax.

The ICIEC partnership will give EXIM Bank international expertise in credit and political-risk mitigation, which the minister said would strengthen its institutional capacity. He called for joint effort from commercial banks and exporters, with the EDF, EXIM Bank, SBP and the federal government also involved. He also noted IT exports have reached around $4.6 billion and freelancers contribute about $1.7 billion, though merchandise exports still need far larger growth.