Pakistan has established a Rs3 billion risk pool to expand export credit insurance coverage, with small and medium-sized enterprises (SMEs) expected to be among the key beneficiaries as the government works to strengthen the country’s export capacity. The initiative is being jointly pursued by the Export Development Fund (EDF) and Export-Import Bank of Pakistan (EXIM Bank) and is designed to help businesses manage risks associated with international trade while improving their ability to access export financing. The measure forms part of wider government efforts to shift the economy toward an export-led growth model and reduce some of the financial constraints faced by businesses seeking opportunities in international markets.
Prime Minister Muhammad Shehbaz Sharif welcomed the establishment of the risk pool during a meeting focused on the restructuring and reforms of the Export Development Fund. The meeting reviewed measures aimed at improving support for the business community and strengthening Pakistan’s export position. The Prime Minister said improved access to export credit insurance would assist businesses in increasing their export volumes. Export credit insurance can help businesses manage risks associated with overseas transactions, providing greater confidence when dealing with international buyers and supporting their efforts to secure financing for export-related activities.
The meeting was informed that the entire Rs24 billion currently available with the Export Development Fund has been allocated for investments aimed at facilitating the business community. The allocation reflects the government’s intention to use available EDF resources to support businesses rather than directing additional funds toward infrastructure spending. The government is also seeking to redirect EDF resources toward areas including research, skills development and initiatives designed to improve competitiveness. These areas are being considered important for strengthening the ability of Pakistani businesses to compete in international markets and expand their export activities.
SMEs are expected to benefit significantly from the expanded export credit insurance coverage because smaller businesses can face greater difficulties when seeking trade finance and managing the risks connected with international transactions. The Rs3 billion risk pool being pursued by EDF and EXIM Bank is intended to provide broader coverage and help businesses deal with trade-related risks. Better access to export financing could allow eligible businesses to participate more actively in international trade and pursue additional export opportunities. The initiative is therefore being positioned as part of a broader effort to remove financial constraints affecting businesses, particularly smaller exporters.
The Prime Minister also highlighted changes made in the leadership structure of the Export Development Fund, noting that its restructuring has placed leadership responsibilities in the hands of private-sector professionals. According to the meeting, the available funds are being utilised to support businesses, while the government is seeking to ensure that EDF resources contribute toward areas that can strengthen the private sector. The focus on research, skills development and competitiveness is intended to provide businesses with support beyond direct financial assistance and help improve their capacity to operate in international markets.
The meeting also reviewed efforts to maintain Pakistan’s access to European markets through an extension of the country’s preferential trade arrangement under the GSP Plus framework. Continued access to European markets remains important for Pakistani exporters, as preferential trade arrangements can support the country’s export activity in international markets. The review of the GSP Plus framework alongside the export credit insurance initiative reflects the government’s broader focus on improving market access and addressing financial challenges faced by exporters.
The measures come as the government seeks to strengthen Pakistan’s export capacity and reduce constraints affecting businesses attempting to access trade finance and international markets. By expanding export credit insurance coverage through the Rs3 billion risk pool and allocating EDF resources toward business support, research, skills development and competitiveness, the government aims to provide businesses with greater support for export expansion. Shehbaz Sharif said the initiatives reflected the government’s commitment to an export-led economy and its objective of positioning Pakistan as a global investment hub.
Follow the PakBanker Whatsapp Channel for updates across Pakistan’s banking ecosystem.