FPCCI Welcomes Historic 3% Cut in Export Refinance Facility Emphasizes Export-led Growth as the Only Viable Path Atif Ikram Sheikh

Karachi: Mr. Atif Ikram Sheikh, President of the Federation of Pakistan Chambers of Commerce
& Industry (FPCCI), has warmly welcomed the banking sector’s voluntary decision to reduce the
Export Refinance Facility (ERF) rate by 3%, bringing the end-user cost down to a competitive
4.50% – while reiterating FPCCI’s stance that export-led economic growth is the only viable,
sustainable and pragmatic way forward for the country.

Mr. Atif Ikram Sheikh, President FPCCI, termed the move a timely lifeline for the country's
export-oriented industries, stating that the reduction effectively addresses the FPCCI’s
long-standing demand to rationalize the cost of capital and reduction in the cost of doing 
business.

Mr. Atif Ikram Sheikh elaborated that the initiative is currently subject to the existing ERF limit
of Rs1,052 billion – though this limit is inherently designed to be flexible; and, may be raised
when the State Bank of Pakistan (SBP) or Export-Import Bank of Pakistan (EXIM Bank)
increase the limit through June 2027.

Mr. Atif Ikram Sheikh explained that this 300 basis point reduction is not just a monetary
adjustment; it is a direct injection of competitiveness into our manufacturing and export sector.
With the new ERF rate of 4.50%, Pakistani exporters are now better positioned to compete with
regional rivals like Bangladesh and Vietnam – who have historically enjoyed single-digit,
competitive financing costs.

The FPCCI President highlighted that the relief comes at a crucial juncture where the private
sector is trying passionately to support the government’s vision of robust economic recovery and
export growth. He predicted this rate cut would accelerate industrial borrowing.

FPCCI Chief pointed to the 57% surge in the SME borrower base over the last fiscal year,
emphasizing that a 4.5% ERF rate will sustain this momentum for small exporters who are most
vulnerable to high financing costs.

Mr. Atif Ikram Sheikh apprised that FPCCI forecasts that this cost reduction could push
year-on-year export growth in the positive territory, if continued support is extended to the
exporters from the government and its institutions – while appreciating the State Bank of
Pakistan (SBP) for facilitating exporters vis-à-vis access to finance.

The FPCCI reiterated its commitment to working with the government to achieve the national
export target – confident that the reduced ERF rates will serve as a cornerstone for economic
stability in 2026 and beyond.

Brig Iftikhar Opel, SI (M), Retd.

Secretary General