Sialkot’s small workshops and factories have sent $1.8 billion in foreign exchange to Pakistan in the fiscal year 2024-25, the Sialkot Chamber of Commerce and Industry (SCCI) announced on Wednesday.

The figure, confirmed by SCCI President Syed Ihtesham Gillani, places Sialkot among the top three forex-earning districts in Punjab and the sixth-largest contributor nationwide. More than 80% of this amount came from three key sectors: leather goods, sports goods, and surgical instruments, with leather exports alone crossing the $1 billion mark for the first time in the city’s history.

The surge in forex earnings comes despite global headwinds—rising shipping costs, fluctuating dollar rates, and tighter compliance checks by the European Union and the United States. SCCI officials attribute the growth to aggressive marketing in new markets like Africa and Southeast Asia, as well as government incentives under the Export Development Fund (EDF) and Long-Term Financing Facility (LTFF).

How Sialkot does it: the numbers behind the boom

- $1.8 billion in forex earned in FY2025 (July 2024 – June 2025)
- $1.1 billion from leather goods (up 18% YoY)
- $420 million from sports goods (up 12% YoY)
- $280 million from surgical instruments (up 9% YoY)
- 85% of exports go to the EU, US, and UK
- 15% to Africa, Middle East, and Southeast Asia

The city’s 4,500 registered exporters and over 12,000 small workshops employ more than 250,000 people, many of them women stitching footballs and gloves in home-based units. The average monthly wage in these units is Rs 22,000–28,000, barely above minimum wage but enough to keep families afloat in a district where agriculture is shrinking.

What’s driving the growth? Government and grit

SCCI’s Gillani credits three factors for the record haul:

  1. Government schemes: The EDF reimburses up to 4% of export value for marketing and compliance costs. The LTFF offers loans at 6% for machinery upgrades, helping small units buy automated stitching machines.
  1. Diversification: After years of relying on the US and EU, exporters have opened offices in Nigeria, Kenya, and Vietnam. A Sialkot-based leather exporter told Naya Pakistan that his firm now sells 20% of output in Africa, up from 5% two years ago.
  1. Compliance push: Factories that upgraded to ISO 9001 and BSCI standards saw fewer rejections in Europe. The SCCI spent Rs 150 million on training 3,200 workers in quality control last year.

The challenges: why it’s not all smooth sailing

Despite the headline numbers, exporters face three stubborn hurdles:

  • Dollar volatility: The Pakistani rupee lost 25% against the dollar in the last 12 months, shrinking profit margins.
  • Red tape: Customs clearance at Lahore’s Allama Iqbal International Airport takes 5–7 days for urgent shipments, compared to 2–3 days in Dubai.
  • Energy costs: Frequent gas and electricity outages cost leather tanneries Rs 800 million in lost production last year, SCCI estimates.

Gillani says the chamber has written to the Federal Board of Revenue (FBR) and Ministry of Commerce for faster refunds under the Drawback of Duties and Taxes scheme. "We need the money back in 30 days, not 90," he told Naya Pakistan.

What this means for you

If you’re a consumer, the forex bonanza has two direct effects:

  • Cheaper imports: A stronger rupee (when it holds) makes imported goods like smartphones, cars, and medicines slightly cheaper.
  • More jobs: The export boom has created 15,000 new jobs in Sialkot since 2023, mostly in stitching, cutting, and packaging.

If you’re an exporter, here’s what to watch:

  • New markets: SCCI is organising a Sialkot Expo Africa in Nairobi in November 2025 to help firms break into East Africa.
  • Compliance deadlines: The EU’s Carbon Border Adjustment Mechanism (CBAM) kicks in fully in January 2026. Factories emitting high CO₂ will face tariffs unless they switch to cleaner energy.
  • Loan window: The State Bank of Pakistan (SBP) has extended the LTFF scheme till June 2027. Apply through your bank with a business plan and machinery invoice.

What’s next: the road to $2 billion

SCCI has set a target of $2 billion in forex earnings for FY2026. To hit it, Gillani says the chamber will:

  • Push for direct flights between Sialkot and African capitals to cut shipping time.
  • Lobby for a 2% subsidy on gas for tanneries.
  • Train 5,000 more workers in digital marketing and e-commerce.

The city’s mayor, Muhammad Masood Anwar, told Naya Pakistan that the district government is building a new cargo terminal at Sialkot International Airport, set to open in March 2026. "This will cut air freight costs by 30% and add 200,000 tonnes of annual capacity," he said.

How to check your export status

If you’re an exporter registered with SCCI:

  1. Log in to the Pakistan Single Window (PSW) portal: https://psw.gov.pk
  2. Enter your NTN and IRC numbers.
  3. Check real-time status of Drawback claims, EDF reimbursements, and customs clearances.

For non-members, SCCI’s Export Facilitation Centre at 70-A Jinnah Road, Sialkot, offers free advice on compliance and markets. Call 052-4221111 for an appointment.

Bottom line

Sialkot’s forex earnings are a rare bright spot in Pakistan’s balance-of-payments crisis. But the boom is fragile—dollar swings, red tape, and energy costs can wipe out gains overnight. The next 12 months will show whether the city can turn its workshop economy into a sustainable engine of growth, or whether it will remain hostage to forces beyond its control.

For now, the leather gloves, footballs, and scalpels stitched in Sialkot’s back alleys are keeping Pakistan’s foreign reserves afloat. Whether that changes depends on how fast the city can adapt—and how much help it gets from Islamabad.