For many years, Pakistan’s export strategy has largely focused on expanding exports through market access, trade agreements and export promotion. While this approach remains important, the nature of global competition has fundamentally changed. Today, competitiveness is increasingly determined by productivity, technology, sustainability, digital capabilities, resilient supply chains and the ability to adapt quickly to changing market conditions.
Against this backdrop, the Ministry of Commerce deserves recognition for keeping export promotion high on the national agenda despite challenging economic conditions. Through trade diplomacy, preferential trade agreements, market access initiatives, support provided by the Trade Development Authority of Pakistan (TDAP) and sustained engagement with the business community, the Ministry has created new opportunities for Pakistani exporters. These efforts remain important because expanding exports is essential for economic growth, foreign exchange earnings and employment.
Pakistan’s merchandise exports reached approximately US$32.4 billion in 2024, while information technology exports have continued to show encouraging growth, reflecting the resilience and potential of Pakistani businesses. (Sources: World Trade Organization; Pakistan Bureau of Statistics).
However, export performance should not be judged only by export earnings. The key question is whether Pakistan is increasing its share of international markets and becoming more competitive compared with global rivals.
For decades, Pakistan’s export debate has centred on one question: How can exports be increased? That remains an important objective, but the more strategic question today is whether Pakistan is becoming more competitive than its global competitors.
In today’s rapidly evolving trading environment, exporting more is important, but retaining and expanding global market share is even more critical. Export promotion wins orders. Export competitiveness wins markets.
Short term export fluctuations are inevitable, but long-term success depends on productivity growth, innovation, technology adoption, efficient logistics, skilled human capital and the ability to respond quickly to changing market conditions.
The rules of international trade are being rewritten. Competitiveness is no longer determined only by price and quality. Artificial intelligence, advanced manufacturing, digital trade, sustainability standards, carbon regulations, supply chain resilience and changing buyer expectations are becoming decisive factors in determining which countries gain or lose market share.
These are not future challenges. They are already influencing purchasing decisions, investment flows and global supply chains. Countries that recognized these shifts early have repositioned their industries accordingly, while others risk losing competitiveness despite having access to traditional markets.
Pakistan’s export structure remains concentrated in traditional sectors, particularly textiles and apparel. These sectors will continue to remain the backbone of Pakistan’s exports, but the nature of competition has fundamentally changed. International buyers increasingly evaluate suppliers not only on cost and quality but also on productivity, innovation, digital capabilities, sustainability and compliance with global standards.
The experience of competing economies provides valuable lessons.
Vietnam has combined an extensive network of free trade agreements with sustained investment in manufacturing capability, logistics, technology and integration into global value chains. As a result, its merchandise exports now exceed US$400 billion annually, compared with Pakistan’s exports of around US$32 billion. (Source: World Trade Organization).
Malaysia has steadily strengthened its position in high value manufacturing through electronics, semiconductors and digital industries. Bangladesh has complemented its apparel industry with significant investment in green manufacturing, compliance and export readiness. The UAE has transformed itself into a leading trade and logistics hub through world class infrastructure, digital trade facilitation and business friendly policies.
The apparel sector clearly illustrates the changing nature of competition. Pakistan possesses a strong textile base and decades of manufacturing experience, yet Bangladesh has become the world’s second largest apparel exporter after China, while Vietnam has significantly expanded its position in global apparel and manufacturing value chains. Their success has not been based only on lower costs but on sustained investment in productivity, technology, logistics, compliance and industrial competitiveness.
The European Union’s Carbon Border Adjustment Mechanism provides another example of how trade rules are evolving. Exporters in carbon intensive industries will increasingly need to demonstrate the carbon footprint of their products. For Pakistan’s textile sector, which accounts for around 60 percent of merchandise exports, this is no longer a distant regulatory issue. It is becoming an important determinant of future market access.
Digital trade presents a similar opportunity and challenge. Countries such as Vietnam and India have invested heavily in cross border e commerce, digital payment systems, logistics infrastructure and government supported digital trade facilitation. These initiatives have enabled their businesses to access global consumers more efficiently, while many Pakistani exporters continue to navigate this rapidly expanding space with limited institutional support.
The restructuring of global supply chains under the China Plus One strategy has created significant opportunities for emerging manufacturing economies. Vietnam moved quickly to attract relocating industries, while Bangladesh strengthened its position in apparel manufacturing.
Pakistan has yet to develop a comprehensive strategy for positioning itself as a preferred destination for supply chain relocation, including identifying priority sectors, improving investment facilitation and effectively communicating its manufacturing capabilities to global investors.
These examples highlight an important reality: successful exporting nations are no longer focusing only on selling more products abroad. They are building the capabilities required to compete in tomorrow’s markets. This is the fundamental shift that Pakistan’s export policy now needs to recognize. This is where Pakistan’s trade policy framework needs to evolve further.
While considerable attention is devoted to export promotion, comparatively less emphasis is placed on export competitiveness intelligence. Most export promotion initiatives focus on helping Pakistan sell more of what it already produces in markets it can already access. The bigger challenge is preparing Pakistani industries for markets where the conditions of entry themselves are changing.
Pakistan needs to know not only what it exports, but also which products are gaining or losing global market share, which competitors are outperforming Pakistan, why international buyers are shifting towards alternative suppliers and which emerging sectors offer future export potential.
The Ministry of Commerce should build upon its existing export promotion role by developing into Pakistan’s strategic trade intelligence institution. Leading commerce ministries around the world increasingly function as intelligence and foresight platforms, continuously monitoring regulatory developments, technological change, buyer preferences and competitive shifts, and translating this information into practical guidance for domestic industries.
Trade policy can no longer remain reactive. It requires continuous trade foresight to identify emerging risks and opportunities before they reshape international markets.
No exporter should learn about a major international compliance requirement from a foreign buyer after an order has been placed. The role of public institutions is to provide this intelligence well in advance, enabling businesses to prepare before new standards become barriers to trade.
One practical initiative could be the publication of a Pakistan Export Competitiveness Report on a quarterly basis by the Ministry of Commerce in collaboration with TDAP. More than a statistical publication, it should serve as a strategic early warning system by monitoring Pakistan’s global market share, benchmarking competitor economies, identifying emerging regulations, assessing technological developments and highlighting future export opportunities. Such an initiative would strengthen evidence-based policymaking and enable exporters to respond proactively rather than react after markets have already shifted.
Export competitiveness also extends beyond the mandate of any single institution. It requires close coordination among the Ministries of Commerce, Industries and Production, Information Technology and Climate Change, TDAP, SMEDA, research institutions, chambers of commerce and the private sector. In today’s global economy, competitiveness has become a national agenda rather than the responsibility of one ministry alone.
Pakistan possesses many strengths. It has an entrepreneurial private sector, internationally recognized textile and agricultural products, a rapidly expanding information technology sector, a young workforce and a strategic geographic location connecting South Asia, Central Asia, China and the Middle East. These advantages provide a strong foundation.
The challenge is to complement these strengths with higher productivity, greater innovation, wider technology adoption, stronger skills development and institutional preparedness. Future export competitiveness will also depend on developing skills aligned with advanced manufacturing, digital technologies and emerging global industries.
The next generation of export success will not be determined simply by how many markets Pakistan enters, but by how competitive its industries remain once they reach those markets. The countries leading global trade today are not necessarily those with the lowest costs; they are those that anticipate change, invest in capabilities and continuously upgrade their competitiveness.
Pakistan has the entrepreneurial talent, industrial foundation and strategic location to compete globally. But these advantages must now be supported by a new approach to trade policy that places productivity, innovation, technology adoption and market intelligence at the center of export strategy.
The future challenge for Pakistan is not only to export more, but to ensure that Pakistani products remain preferred by global buyers in an increasingly demanding marketplace.
The next chapter of Pakistan’s trade policy should therefore move beyond an Export Promotion Strategy towards a comprehensive Export Competitiveness Strategy. The countries that prepare for tomorrow’s trade environment today will shape global commerce tomorrow. Pakistan must ensure that it is among them.
[The writer is an Economic Analyst and former Secretary General of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI). He has also served as Senior Director Research at the Institute of Cost and Management Accountants of Pakistan (ICMAP). He can be reached at [email protected]]
