- Government decides to withdraw 0.25% EDS with immediate effect.
- Policy changes are expected to provide immediate relief to exporters.
- ECNEC approves development projects worth Rs 507 billion.
ISLAMABAD: The federal government has introduced several important policy measures aimed at boosting the economy, supporting exporters and providing relief to citizens, The news reported Tuesday.
The initiatives include energy prices, export reforms, development spending and oversight of state-owned enterprises.
From withdrawing the long-running Export Development Allowance (EDS) to reducing the prescribed gas prices, approving over Rs 507 billion. in development projects and strengthening oversight of key state-owned enterprises (SOEs), the government is signaling a renewed focus on economic revival, institutional reforms and public welfare.
In a major policy development aimed at increasing Pakistan’s export competitiveness, the government decided to withdraw 0.25% Export Development Surcharge (EDS) with immediate effect. The decision was taken during a meeting held on Monday at the Prime Minister’s House, attended by senior federal ministers and members of the private sector.
The prime minister had earlier formed a dedicated working group on EDS, headed by Musadaq Zulqarnain, to review the Export Development Fund (EDF) and suggest reforms to strengthen Pakistan’s export ecosystem. The group included private sector leaders Shahzad Saleem, Misbah Naqvi, Khurram Mukhtar, Arif Saeed, Ahmad Umair and Sualeh Faruqi along with Commerce Secretary Bilal Azhar Kiyani and officials from EDF.
Speaks exclusively to The news Khurram Mukhtar said the recommendations were finalized after “a detailed evaluation of existing EDF-funded initiatives and their limited impact on export productivity.”
He added: “The withdrawal of EDS is a critical step. Exporters have long argued that this surcharge had become a burden rather than a facilitator. The Prime Minister’s decision sends a strong signal that competitiveness is now the top priority.”
During the meeting, the prime minister also directed for the formation of an interim steering committee to be headed by representatives from the private sector to oversee the utilization of the Rs 52 billion currently available in the EDF. The committee has been given a mandate to ensure that the funds are used exclusively for R&D, skills development and interventions that promote competitiveness rather than infrastructure-related projects.
Khurram Mukhtar noted that the new oversight mechanism would “ensure transparency, efficiency and private sector direction in how EDF resources are used.”
The meeting also touched on another long-standing concern of the export community: the disproportionately high tax burden on export-oriented industries compared to domestic companies. A separate task force, headed by Shahzad Saleem, has already given its recommendations on the tax issue and the prime minister is expected to call a dedicated meeting soon.
According to Mukhtar, “Taxation of export-oriented sectors has become distortive and uncompetitive. The government’s willingness to look into this issue seriously is a positive sign for the industry.”
The policy changes announced on Monday are expected to provide immediate relief to exporters while laying the foundation for a more competitive and innovation-driven export sector.
Meanwhile, the Executive Committee of the National Economic Council (ECNEC), under the chairmanship of Deputy Prime Minister Ishaq Dar, approved development projects worth Rs 507 billion, including the continuation of the Emergency Polio Eradication Program (2026-2029).
The 4th Revised PC-I for the Emergency Polio Eradication Plan (2026-2029) represents Pakistan’s commitment to achieve complete cessation of poliovirus transmission and secure global certification by 2029.
The extension and revised funding framework of $639.54 million is designed to sustain essential eradication activities—vaccine procurement, campaign operations, surveillance, and community engagement—during the program’s final phase.
While the project demonstrates strong strategic alignment with the Global Polio Eradication Initiative (GPEI) and the National Emergency Action Plan (NEAP), several critical considerations emerge. The program remains entirely dependent on external funding, primarily through grants and loans from development partners and the Islamic Development Bank.
This dependency underscores the need for a clear transition and sustainability strategy that enables gradual integration of polio assets—workforce, surveillance systems, and logistics—into the Expanded Program on Immunization (EPI) and the broader primary health care framework. Operationally, Pakistan’s well-established Emergency Operations Center (EOC) network and multi-tiered governance mechanism provide an effective platform for coordination and accountability.
However, management reviews, risk mitigation measures and stronger provincialization of financial and physical targets are needed to ensure transparency and effectiveness. Sustained political ownership at the federal and provincial levels, continuous community engagement to address denial and safety protections for frontline workers remain essential prerequisites for success.
According to official notification, ECNEC approved development projects worth over Rs 507 billion covering key sectors including education, health, water supply and major national infrastructure. ECNEC reviewed a presentation of the PIMA Action Plan: Specific Guidance for Appraisal under the IMF program and while endorsing the appraisal guidelines, directed that an update on economic/social discount rate revision by PIDE be submitted within two months.
In the education sector, the committee approved the revised flood-affected schools reconstruction project in Sindh, which will now cover 481 schools on a 50:50 cost-sharing basis between the federal government and the Sindh government.
In the health sector, ECNEC approved the restructured KP Human Capital Investment Project (Health Component), financed through a World Bank loan.
For water supply and municipal services, the revised Karachi Water & Sewerage Services Improvement Project (KWSSIP) phase II was approved, incorporating new funding from the European Investment Bank and an expanded scope with additional filter plants.
Major infrastructure approvals included the lifting of the Mangla Dam project and important road projects such as the revised Ziarat Mor-Kech-Harnai and Harnai-Sanjavi roads, as well as a new 110 km road from Iran’s border to Panjgur to open a new international border point. ECNEC also approved the revised land acquisition and compensation plan for the Karachi-Lahore highway.
In Balochistan, the committee approved the revised water resources development project worth Rs 49.9 billion. In Sindh, the Rs 42 billion Flood Response Emergency Housing Project (Phase III) was approved to support reconstruction in flood-affected communities.
In a related development, the Cabinet Committee on the State Owned Enterprises (CCoSOEs) has approved the appointment of independent directors to the board of Zarai Taraqiati Bank Limited (ZTBL), Port Qasim Authority, and the nomination to fill the casual vacancy on the board of Sui Northern Gas Pipelines Limited (SNGPL).
The CCoSOEs also approved the board members of Sindh Engineering (Pvt) Limited (SEL), Small and Medium Enterprises Development Authority (SMEDA) and the composition of the board of the State Engineering Corporation (SEC).
The CCoSOEs met in Islamabad under the chairmanship of Federal Minister for Finance and Excise, Senator Muhammad Aurangzeb, on Monday.
The committee considered summaries from the Finance Department, the Maritime Division, the Petroleum Division and the Industry and Production Department and approved the agenda items presented. These included the appointment of an independent director to the board of Zarai Taraqiati Bank Limited (ZTBL), proposed by the finance department; the appointment of independent directors to the board of the Port Qasim Authority, Karachi, as proposed by the Maritime Affairs Division; and the nomination to fill the casual vacancy on the Board of Directors of Sui Northern Gas Pipelines Limited (SNGPL), submitted by the Petroleum Division.
The committee also approved three minutes of the Industries and Production Division, namely the composition of the board of Sindh Engineering (Pvt) Limited (SEL), the appointment of a private sector member from Punjab to the board of the Small and Medium Enterprises Development Authority (SMEDA) and the composition of the board of the State Engineering Corporation (SEC).
Concluding the meeting, the Chairman appreciated the diligence shown in the selection of suitable candidates from the private sector to serve as independent directors and stressed the importance of continuing this rigorous approach to ensure that people with the necessary experience, expertise, knowledge and professional insight are appointed to the boards of these and other state-owned enterprises.
The committee also asked the Department of Finance and the Department of Privatization to conduct a comprehensive investigation, evaluation and stocktaking of pending litigation across state-owned enterprises earmarked for privatization and, in coordination with the relevant ministries and legal departments, work to identify mechanisms to iron out these issues to ensure their readiness for a smooth privatization process.
