Budget doesn't have much for the struggling textile manufacturers of Pakistan, other than one positive, is the cutting down of the export refinance rate from six per cent to 4.5 per cent and the long-term refinance rate from 7.5 per cent to six per cent. This will encourage borrowing in the sector. The establishment of an Exim bank for the promotion of exports also comes as a positive.

By 2019 the textile policy is expected to generate employment for three million people. The zero-duty rating on imports of machinery will be maintained. Also the much-needed tax refunds will be paid till September.

Sales tax on the spinning, weaving, and processing segments have been raised from two to three per cent whereas the tax on unfinished cloth and garments has been kept constant at three and five per cent respectively. What remains unaddressed, despite all the mentions of increased tax collection and tax-to-GDP ratio, is a broadening of the tax base.

Textile exporters say the global lack of competitiveness on the back of an overvalued rupee also remains unaddressed.

Exports all over the world are zero-rated and Pakistan wants to be no exception. The government has to pay around Rs16 billion in customs duty drawbacks and Rs 25 billion in sales tax refunds.