AGP Executive Report

Automotive Exports: Sazgar Engineering Works has opened a three-wheeler assembly plant in the Philippines, with annual capacity of about 12,000 vehicles, including electric models. Energy Shortages: LPG is selling for as much as Rs700 per kg despite an official rate of Rs294, and marketers have threatened a nationwide strike from Nov. 16. SNGPL has also extended its ban on new domestic and commercial gas connections indefinitely as winter demand rises and LNG supplies tighten. Fuel Pricing: A revised petrol formula ties import costs to PSO cargoes and freezes key refinery charges for 30 days. Refineries warn pricing interventions could put their planned $6 billion upgrade at risk. Manufacturing and SMEs: Pakistan is targeting 50% local content in mobile-phone production, while a new Alibaba initiative aims to train 10,000 small businesses to reach export markets.

Farm Inputs: Pakistan faces a fertiliser shortfall of more than 200,000 tonnes after gas disruptions shut two urea plants. Imports already meet about half of national demand, while prices are rising. Energy Costs: OGRA raised November LPG prices, lifting the 11.8kg cylinder to Rs3,470. The prime minister has also ordered a review of proposed changes that would shift LPG imports and pricing to state-owned companies. Refinery Policy: Refineries say a new petrol-pricing formula forces them to sell below cost and puts investment plans at risk. Power Sector: The government is targeting the privatisation of FESCO, GEPCO and IESCO in early 2027, citing high electricity costs as a drag on industrial competitiveness and exports. Trade and Exports: Pakistan and Qatar are advancing cooperation in sectors including agriculture, logistics, mining and petroleum, while Pakistan and Saudi Arabia are pushing for an early GCC free-trade deal. Finance officials are also seeking better access to funding and overseas markets for SME exporters.

Industrial Push: Punjab launched its Rs1.99 trillion PIVOT plan to expand exports, modernise industry and create one million jobs. Energy Costs: Qatar’s extended LNG supply disruption threatens Pakistan’s winter gas supplies, as OGRA raised October RLNG prices by 15.3%; LPG prices are also climbing, squeezing businesses and households. Manufacturing: Pakistan is targeting 50% local value addition in mobile-phone production, after producing more than 20 million phones in the first nine months of 2026. SMEs and Exports: SME financing has doubled to Rs1.1 trillion, while SMEDA and Alibaba plan to train 10,000 small businesses for global markets. Pakistan’s exports rose 7.7% to $8.5 billion in the first quarter of FY27. Investment Links: Punjab invited French firms to invest in agriculture, food processing, wastewater projects and industrial energy, while Pakistan and Saudi Arabia discussed wider trade and industrial cooperation.

Energy Costs: The government is reviewing proposed LPG reforms that would shift imports and price-setting to state-owned firms, as supply disruptions push market prices well above the regulator’s notified rate. October RLNG prices also rose by up to 15.27%, adding pressure on businesses and power generation. Industrial Ties: COMSATS Lahore and a China-linked trade body signed an agreement to connect universities and industry through work on AI, agriculture, automotive supply chains and technology transfer. Punjab Investment: The province’s Rs1.99 trillion PIVOT plan targets $6.8 billion in additional exports and 162,000 jobs over three years, with major funding for industry and concessional project loans. SME Exports: SMEDA and Alibaba.com will train 10,000 businesses and help up to 2,000 join the export platform, with eligible firms able to receive grants of up to Rs150,000. Business Finance: The SBP is consulting on open-banking rules to support digital payments and improve SMEs’ access to credit; it has also raised the collateral-free SME loan limit to Rs50 million. Oil and Gas: OGDCL reported first-quarter profit of Rs58.5 billion, up 53% year on year, despite gas supply curbs that reduced production.

Fuel and Energy: Petrol rose to Rs377.91 per litre and diesel to Rs399.82, adding pressure on businesses and transport costs. Pakistan also offered Saudi Arabia tax-free oil storage and discussed investment in refinery upgrades, LPG supplies and minerals. Manufacturing: A proposed mobile phone policy aims to lift local value addition to 50%, from an estimated 10–20%. Lucky Cement approved a 3.2-million-tonne capacity expansion at its Karachi plant. Trade and Logistics: Pakistan and China agreed to launch a green channel at the Sost-Khunjerab border to speed trade, while the government directed the NHA to accelerate major highway projects. Business and Exports: Exports grew 7.7% to $8.5 billion in the first quarter of FY27, and the SBP launched SMEConnect, a digital platform intended to simplify business financing.

Cement Investment: Lucky Cement plans a Rs50 billion Karachi expansion, adding 3.2 million tonnes of annual capacity by December 2027 and expanding wind power at the site. SME Finance: SBP’s SMEConnect portal becomes the required route for loan applications from November 1, while the government is considering better export financing and risk-sharing for small businesses. Energy Costs: Diesel has crossed Rs400 per litre, and NEPRA is reviewing a proposed Rs2.56-per-unit fuel adjustment that could raise power bills for industry. Trade and Exports: Pakistan’s exports rose 7.7% to $8.5 billion in the first quarter; a new green channel at Sost-Khunjerab aims to speed trade with China. Cleaner Industry: GIZ will support 300 Sindh SMEs with environmental compliance and access to green financing. Cotton Revival: The government is weighing a cut in imported cotton-seed approval times from nearly seven years to 12–18 months to improve yields.

Exports: Pakistan’s tyre industry is targeting $150 million in exports in FY27, up from $116 million last year, as the Commerce Ministry works to address market-access barriers in Türkiye. Local Manufacturing: Factories assembled 20.08 million mobile phones in the first nine months of 2026, far outpacing imports of finished handsets. Master Changan has also begun deliveries of the locally assembled NEVO Hunter, a range-extended electric 4x4. Trade Links: Pakistan and China agreed to fast-track customs clearance for selected agricultural goods at the Sost-Khunjerab crossing, helping cut delays and spoilage. Energy and Shipping: Disruptions around Iran are pushing up freight costs and leaving cargo stalled, while Qatar’s LNG supply problems add pressure to Pakistan’s energy market. Industry Investment: Lucky Cement approved a 3.2-million-tonne capacity expansion at its Karachi plant, while the government is considering a construction industry authority to support the sector. Agriculture: Pakistan and Saudi Arabia discussed investment in agriculture, minerals and mining, as Nestlé Pakistan and LUMS launched a training programme on regenerative farming.

Energy: Qatar has offered revised LNG pricing at 11.96% of Brent for Pakistan’s long-term contracts, with annual deliveries reduced from 108 cargoes to 66; PSO is awaiting government approval. LPG prices have also spiked, with reported cylinder costs far above the official cap. Business Climate: Federal and provincial governments are reviewing regulations and offering 30-year leases on 6,409 acres of Pakistan Steel Mills land to attract investors, as Pakistan targets a place among the world’s 10 easiest countries to do business. Textiles: Net textile exports rose by about $930 million in FY2026 as imports fell, but the World Bank forecasts Pakistan’s cotton output will drop 6% this year. Finance: The SBP has introduced a framework to widen credit access for small businesses and farmers; the finance minister is also pressing lenders to speed up disbursements. Textile exporters warn the recent rate increase to 12% will raise costs. Digitalisation and Growth: The prime minister has set a November deadline for Alibaba-backed AI and digital projects, including agricultural automation and export support. A new government plan is also being developed to expand shrimp farming and aquaculture exports.

Agriculture Finance: Punjab plans a farmers’ bank and interest-free loans of up to Rs100 million, while raising Kisan Card financing limits. Finance Minister Muhammad Aurangzeb also urged faster delivery of SME and agriculture loans; outstanding financing stands at Rs1.148 trillion for SMEs and Rs1.329 trillion for agriculture. Energy Costs: LPG shortages have pushed cylinder prices to Rs25,000–26,000, squeezing hotels and small businesses already facing rising costs. Textiles: The National Tariff Commission has opened an anti-dumping probe into cotton yarn imports, a closely watched move for local manufacturers. Digital Growth: Prime Minister Shehbaz Sharif set a November deadline for projects under Pakistan’s Alibaba partnership, including AI and digital tools for agriculture, exports and trade. Clean Air: Punjab inspected 11,580 brick kilns in a month, demolishing 197 and sealing 163; the federal government also plans a $10 million fund for clean-air startups.

Fuel Costs: Petrol fell Rs3.19 to Rs376.06 per litre from Oct. 28, while diesel rose Rs2.25 to Rs398.07. Business Finance: The SBP’s 50-basis-point rate hike to 12% drew strong opposition from business and textile groups, who warn higher borrowing costs will hurt investment and export competitiveness. Power Relief: The government is working on targeted subsidies to replace the six-month penalty for households crossing 200 units, while Energy Supply: reported QatarEnergy delivery disruptions through year-end add pressure to Pakistan’s gas market. Exports and Manufacturing: TDAP plans new support for value-added exports and digital trade; the National Tariff Commission has opened an anti-dumping probe into high-count cotton yarn imports from China. Karachi Industrial Park has also won federal special economic zone status. Agriculture: Punjab has reconstituted its Agriculture Commission, and 30,000 university students are set to promote improved wheat-growing practices across six divisions.

Monetary Policy: The SBP raised its policy rate by 50 basis points to 12%, drawing business opposition as higher borrowing costs threaten industrial recovery. Energy Costs: Petrol and diesel prices rose amid regional supply risks. Pakistan is exploring alternative sea routes for LPG, while reopening its Iran border crossing has eased pressure on cooking-fuel supplies. The government is also considering ending six-month electricity penalties for households that just exceed 200 units. Investment & Industry: Pakistan is seeking US investment for refinery upgrades and long-term energy deals, and has invited Qatari investors into special economic zones. Karachi Industrial Park’s new federal SEZ status could support manufacturing growth. Textiles & Agriculture: Cotton production has fallen 60% over the past decade, raising concerns for textile supply. Sindh is expanding oilseed cultivation to reduce reliance on imported edible oil. Pharma Exports: A new programme aims to help pharmaceutical firms meet US FDA standards, as Afghan trade disruptions weigh on exports.

Monetary Policy: The State Bank raised its policy rate by 0.5 percentage points to 12%, citing energy costs and inflation risks. Industry groups warn higher borrowing costs could slow recovery and raise working-capital expenses. Energy & Fuels: Pakistan is discussing long-term energy supplies and refinery investment with the US, while exploring sea routes for LPG after border disruptions. Petrol rose to Rs379 per litre and diesel to Rs395. Agriculture & Textiles: Sindh is expanding mustard, sesame and canola to reduce edible-oil imports. But cotton acreage is about one million acres below target, as production has fallen 60% in a decade. The FBR has given spinning mills until November 15 to install production-monitoring cameras. Industrial Investment: Karachi Industrial Park has been approved as a federal special economic zone, while the government is seeking export-focused industrial proposals.**

Industrial Financing: The State Bank raised its policy rate by 0.5 points to 12% as energy costs and inflation risks mount. SITE industry leaders warned higher borrowing costs could stall factory investment and recovery. Energy Supply: LPG prices have reached Rs650 per kilogram in some cities after Iran border closures disrupted supplies. Trade has partially resumed at the Gabd-Rimdan crossing, with LPG shipments among the goods clearing into Pakistan. Investment and Manufacturing: Gul Ahmed approved the acquisition of 43.75 acres and renewable energy projects, while Karachi Industrial Park received federal special economic zone status. Trade and Infrastructure: Construction on the Sukkur-Karachi Motorway is due to begin next month, improving freight links to Karachi Port. Pakistan and the US also discussed long-term energy supply contracts and investment in refinery upgrades.

Energy Supply: Pakistan is shifting LPG imports to sea routes after Iranian border disruptions cut land supplies. More than 11,600 tonnes arrived at Karachi ports in a week, as prices surged. Officials also urged refinery upgrades and faster oil and gas exploration to reduce import dependence. Power Costs: Businesses warn higher interest rates, electricity and fuel costs could deepen pressure on industry. A ministerial committee is developing a plan to target power subsidies at low-income households. Manufacturing Strain: Cotton spot prices fell by Rs300 per maund, while industry sources say 40–50% of power looms have shut, costing jobs. Sugar mills report Rs98 billion in losses amid a 1.3-million-tonne surplus; at least 12 mills have closed. Investment and Trade: Karachi Industrial Park has received federal special economic zone status, while Pakistan pressed Qatar to speed up a GCC free-trade agreement and resolve barriers to meat exports.

Industrial Growth: A new export task force is consulting leather, sports goods and other sectors on barriers to growth and competitiveness. Cotton Crisis: Production has fallen more than 60% in a decade, prompting calls to curb sugarcane in cotton belts and strengthen research and farmer support. Energy Costs: LPG shortages and price spikes are driving up costs; a 4,000-tonne shipment arrived at Port Qasim, while the reopened Iran crossing may release stranded supplies. Agriculture Value-Add: Farmers’ representatives urged support for small processing units to cut waste and raise incomes. Investment & Infrastructure: WAPDA signed a Rs133bn Diamer-Bhasha Dam contract; Karachi Industrial Park received federal SEZ status, and a Chinese firm completed an access road for a $150m textile project. Digital Economy: Pakistan-U.S. Tech Connect brought companies and officials together to pursue investment and partnerships.

Investment: A Chinese business delegation met FPCCI to explore trade and joint ventures in textiles, technology and biotechnology, with local officials promising investor support. Energy Costs: LPG dealers’ strike has worsened cooking-gas shortages, while the finance minister says oil supplies are secure through November but acknowledges gaps in meeting winter gas and LNG demand. Exports: The government is seeking practical proposals from leather, sports goods, cutlery and carpet makers; the finance minister says growth must be driven by exports, productivity and private investment. Industrial Growth: Karachi Industrial Park has been approved as a federal special economic zone, while Bestway has launched Geely in Pakistan and is preparing for local assembly. Infrastructure: WAPDA signed a Rs133.18 billion contract for hydro-mechanical works at the Diamer-Bhasha Dam, covering gates, steel structures and related equipment.