Pakistan Loses Rs. 750B Yearly Due to Smuggling Report

A recent report has revealed a massive economic loss of Rs. 750 billion annually to the national exchequer due to unchecked smuggling activities across Pakistan. This alarming figure has sparked concern among economists, traders, and government officials, raising urgent questions about border control, tax evasion, and illegal trade networks.

• Pakistan suffers a Rs. 750 billion loss each year due to smuggling.

• Major smuggled items include diesel, cigarettes, mobile phones, tea, tyres, and more.

• Weak border security and corruption play a major role.

• Local industries are collapsing under pressure from illegal imports.

• Experts demand strict action and policy reforms.

The smuggling of goods into Pakistan is not just an illegal activity — it’s a drain on the national economy. According to the recent report, billions in revenue are lost each year as unregistered products flood the market, affecting:

• Local manufacturers

• Retailers

• Tax collection

• Employment opportunities

• Diesel and petroleum products

• Cigarettes and tobacco

• Mobile phones and electronics

• Tea and cooking oil

• Tyres, auto parts, and vehicle accessories

• Textile and clothing items

These products are often brought into the country without paying customs duties or taxes, making them cheaper than locally produced or legally imported items.

• The cigarette industry loses around Rs. 80 billion annually due to smuggled brands.

• Oil refineries and fuel companies face competition from illegally imported diesel.

• The tea industry struggles to survive as untaxed tea imports dominate the market.

• The auto sector suffers from smuggled tyres and parts, leading to job losses.

• Legal businesses close down due to unfair competition.

• The government fails to collect the due taxes.

• Unemployment rises as industries shrink.

• Foreign investors lose interest due to a lack of regulation.

Experts say that smuggling mostly takes place through porous borders, especially:

• Pakistan-Afghanistan border

• Pakistan-Iran border

• Karachi and Gwadar ports

These routes are often used by organized networks that bribe officials and use false documentation to move illegal goods.

The detailed report highlights:

• Over Rs. 250 billion lost due to illegal diesel and petrol trade.

• Nearly Rs. 100 billion lost in illegal cigarette trade.

• Rs. 60 billion in mobile phones evade duties and enter Pakistan every year.

• Tea smuggling leads to a Rs. 35 billion revenue loss.

• Tyre smuggling causes Rs. 30 billion in damages to the local market.

“Smuggling is not just an economic issue, it’s a national security threat,” the report warns.

• Dr. Ashfaq Hassan, senior economist:

  "Pakistan needs structural reforms in its customs and border control systems. Otherwise, we’ll keep losing billions every year.”

• Khurram Shehzad, financial analyst:

  “Smuggling not only reduces tax revenue but also makes it hard for honest businesses to survive.”

Pakistan is already facing an economic crisis, with a growing budget deficit and pressure from the IMF (International Monetary Fund) for tax reforms. In this situation, losing Rs. 750 billion per year to smuggling is unsustainable.

• Tax-to-GDP ratio is already one of the lowest in the region.

• The government is forced to increase taxes on honest taxpayers.

• Loss of revenue leads to cuts in public services, such as health, education, and infrastructure.

Pakistan’s economy is already under immense pressure. Smuggling is bleeding the country of Rs. 750 billion each year — money that could be used for schools, hospitals, and national development. If the government, businesses, and public come together, smuggling can be controlled — but the time to act is now.