The Pakistan Industrial and Traders Associations Front (PIAF) chairman Faheemur Rehman Saigol has said that government needed to highlight the critical role of small & medium enterprises (SMEs) in driving sustainable economic development in Pakistan. With an estimated 5.2 million businesses, the SME sector is a cornerstone of our economy, fostering employment, growth, and export diversification. The PIAF chairman observed that despite their significance, more than 5 million SMEs face a significant credit gap, receiving limited credit, far below the neighboring countries. The State Bank of Pakistan is committed to increasing SME credit share to 17% by 2023. To achieve this, we must advocate for targeted and fixed SME allocations in concessional financing schemes, particularly those aimed at the export-oriented sector. Faheem Saigol proposed the central bank to review its credit policies by fixing a special quota to finance the small and medium enterprises, contributing around 40 percent to the national gross domestic product (GDP). He said that the government with a view to help grow the businesses will have to take solid measures to strengthen the industry, especially the SMEs, saving the livelihood of millions of workers associated with the small industries. The government will have to make a visible reduction in markup rate to help grow the businesses, particularly the SME sector, as Pakistan needs millions of jobs annually. He said that the State Bank of Pakistan has launched various policies for the promotion of SME finance, but the required results were still awaited. It was unfortunate that banks were always reluctant to provide financing to SMEs as their financing continued to show negative growth. In its endeavor to provide concessional financing to the export-oriented sector, the SBP has introduced the Export Finance Scheme, offering financing as low as3%, in stark contrast to the earlier Export Refinance Schemes’ (ERF) markup rates that reached 21%. However, it is a matter of great concern that a substantial portion of this financing has been availed by large corporate industries, leaving no room for SMEs. The current economic challenges demand a targeted approach to support the SMEs, as they are among the hardest-hit and in desperate need of assistance. He said that a small section of public sector and Islamic banks and few DFIs were active in financing SMEs sector. Despite significantly contributing to the GDP, exports and employment generation, the financing percentage of SMEs remained pathetic in general. He urged the government that SME policy should focus on addressing specific issues faced by the SME sector and help check reluctance of financial institutions to provide financing to SMEs.