Pakistan’s leather sector warns of export fall as cost rises

According to Pakistan’s Media reports, representatives of Pakistan’s leather industry have called for urgent structural reforms, citing a combination of high production costs and a fragmented tax regime as significant barriers to global competitiveness.

In a consultative meeting with Federal Commerce Minister Jam Kamal Khan on Thursday, industry leaders warned that the sector, a vital component of Pakistan's export economy, is struggling despite the country's vast livestock resources and manufacturing expertise in footwear, garments, and gloves.

The delegation highlighted several systemic bottlenecks with the minister, including a fragmented system of overlapping federal, provincial, and municipal taxes that squeeze manufactures. To resolve this, the industry is lobbying for a ‘one-window’ taxation mechanism and harmonised compliance to reduce the burden of multiple inspections and approvals. Besides administrative hurdles, the delegation also discussed rising import financing costs and heavy duties on raw materials that are reportedly pricing Pakistani leather goods out of international markets. In the meeting, stakeholders presented preliminary budget proposals calling for duty adjustments on essential inputs and targeted tax relief for export-oriented units.

Khan acknowledged the industry's concerns, stating that boosting exports requires "long-term structural reforms" alongside immediate facilitation. He reaffirmed the ministry's commitment to improving regulatory efficiency and market access.

While the sector sees significant potential for growth through value-chain strengthening, participants stressed that affordable financing and cheaper industrial inputs remain the primary prerequisites for expansion. The meeting concluded with a pledge for continued public-private collaboration to address these long-standing sectoral bottlenecks.