LCCI Opposes Proposed EDB's Tariff Rationalization

LAHORE, (UrduPoint / Pakistan Point News - 20th May, 2025) Lahore Chamber of Commerce & Industry (LCCI) President Mian Abuzar Shad Tuesday

opposed the proposed changes under the draft National Tariff Policy 2025–30 presented

by Engineering Development board (EDB).

He apprehended that the new policy could have serious repercussions for Pakistan’s

industrial base, trade balance and economic sovereignty.

The LCCI President said that while reforming the tariff regime was important, the current

proposal was likely to increase Pakistan’s reliance on imports, shifting the country further

away from a manufacturing-driven economy. He said that by substantially lowering import

duties and eliminating Additional Customs Duty (ACD), Regulatory Duty (RD), the government

risks transforming Pakistan into an import-dependent economy.

Mian Abuzar Shad was of the view that lower tariffs would lead to a surge in imports,

thereby putting immense pressure on the current account and foreign exchange reserves,

which were already under stress. “Pakistan cannot afford such a liberalization at the cost

of macroeconomic stability,” he emphasized.

The LCCI also objected the proposed tariff spread of zero to 15 percent as too narrow

to reflect the developmental needs of a diverse industrial landscape.

“Even globally competitive and specialized economies such as China maintain a much

wider tariff spread to protect sensitive sectors. This narrow spread will blur the line

between manufacturers and importers, this discouraging local production,” he asserted.

These changes, he said, would result in revenue losses for the government while exacerbating

the public debt burden. “The expected drop in customs revenue will need to be compensated

through indirect taxation or further borrowing, both of which will hurt the economy.”

Pointing to the already high cost of doing business in Pakistan, the LCCI emphasized

that this move would further deter industrial growth. “Our industries are already burdened

by high energy tariffs, inefficient labour markets and a complex tax regime. These tariff

reductions could lead to shutdowns and job losses,” he maintained.

The LCCI urged the government to reconsider this premature rationalization and engage

in meaningful consultation with industry stakeholders to develop a tariff structure that

supports both industrialization and exports.