Trade promotion paradox: billions spent, exports fall

Let us monetise the total export subsidies and incentives, foregone taxes on exporters, expenses on the Trade Development Authority of Pakistan (TDAP), commercial diplomacy, and the overseas exhibitions and trade fairs organised; the net exports of Pakistan will give an entirely different and bleak picture.

Pakistan's trade deficit recently widened to a staggering four-year high of $39.47 billion, while merchandise exports missed their target by nearly $5 billion. These are now hovering at the edge between single and double digits of the total GDP, which used to be more than 15% in the 1990s.

There are numerous factors, internal and external, possibly to be attributed to this disturbing trend, but these are neither new nor insurmountable. The one factor, however, outweighs all solutions but would never be recognised, and that is performance accountability.

Starting with the first factor – the institutional setup. Interestingly, amid this steep economic decline, the country's premier export promotion body, the TDAP, is ever expanding and spending ad libitum. Once envisioned as a dynamic, professionally managed successor to the Export Promotion Bureau, TDAP has instead ossified into a bureaucratic monolith. Rather than driving aggressive, market-expanding trade diplomacy, the authority has devolved into little more than a passive clearing house for the country's multibillion-rupee Export Development Fund (EDF).

In an era where global trade is dictated by e-commerce algorithms, complex supply chain integration, and rapid technological shifts, TDAP's promotional toolkit remains stubbornly antiquated. The modern export landscape demands highly tailoured, data-driven strategies, artificial intelligence for market predictive analytics, targeted digital B2B matchmaking, and aggressive branding campaigns designed to pull Pakistani products into high-value supply chains.

Instead, TDAP's primary output appears restricted to a familiar, exhausting loop of sponsoring traditional trade delegations and booking expensive stalls at conventional international expos. Interestingly enough, the same people are sent to the same exhibitions with the same low-value products year after year. There is very little focus on modern product development, compliance with evolving international environmental standards, or digital trade frameworks. The approach isn't professional; it's custodial.

Moving on, the commercial diplomacy is neither commercial nor diplomatic. The process of choosing commercial diplomats has been so-called reformed by introducing the aptitude test, but if one digs deeper into the design, conduct and results, it would provide a good script for a sitcom. The positions of commercial counsellors are considered rewards and paid holidays and draw political backing. KPIs for these chosen ones are even more concerning. A simple matrix is to ask the Ministry of Commerce to show the causal linkage between the drop in exports to the markets assigned to commercial counsellors and the corresponding actions, or rewards in case of actual yet rare market growth.

This structural lethargy has left Pakistan deeply vulnerable. The country remains dangerously over-reliant on a narrow basket of traditional goods, namely low-tier textiles and basic agricultural commodities. When global dynamics shift, such as the return of cheaper competitors to the international market or regional border closures, Pakistan's export volumes instantly contract.

As Pakistan navigates a crucial transition towards an export-led growth model under its newest trade policy reforms, the public and the business community must demand immediate structural accountability. Parliament, the Public Accounts Committee, and the Ministry of Commerce must pose a direct, uncompromising question: "What is the verifiable value for money on every single rupee spent on export promotion and commercial diplomacy over the last five years?" A transparent, comprehensive audit must look beyond mere bookkeeping to evaluate actual performance metrics. The public deserves to see definitive accounting for the last five years in the following areas.

First, product diversification. How many entirely new, high-value product categories (such as tech services, specialised engineering goods, or value-added pharmaceuticals) were successfully integrated into global markets as a direct result of commercial diplomacy?

Second, market penetration. To what degree have we broken out of traditional reliance on the US, EU, and China to capture a meaningful market share in untapped regions like Africa, Central Asia, or South America? Third, return on investment. What is the exact ratio of dollars earned in new export contracts relative to the billions of rupees drained from the national exchequer for commercial diplomats and the EDF to fund international trade delegations?

Accountability cannot simply begin and end with the quiet filing of a damning audit report. Until the commercial diplomacy is subjected to strict, practical and actual key performance indicators (KPIs) and its leadership is judged by the literal growth and diversification of Pakistan's trade footprint, it will remain a financial burden rather than an economic engine. Pakistan can no longer afford to treat export promotion as an administrative luxury; it is a macroeconomic necessity, and it is time for the commercial diplomacy to deliver or be entirely overhauled. This piece is not meant to criticise the ones responsible for this situation, as they are doing their best as per the annual reports, both personal and organisational, but unfortunately the mandate is not being fulfilled, and exports are not increasing.

THE WRITER IS AN INTERNATIONAL ECONOMIST