Lahore: Advisor to Prime Minister on Commerce & Investment Abdul Razak Dawood has said that Pakistan’s exports diversification has been improved considerably during the last three years which is the only way to jack-up the exports.
He was speaking at a meeting at the Lahore Chamber of Commerce. LCCI President Mian Nauman Kabir gave the opening remarks while Senior Vice President Mian Rehman Aziz Chan and Vice President Haris Ateeq also presented their point of view . President FPCCI Nasir Hayat Magoon, former FPCCI President Mian Anjum Nisar, former LCCI Presidents Sheikh Muhammad Asif, Shahzad Ali Malik, Irfan Iqbal Sheikh and Executive Committee Members also spoke on the occasion.
Abdul Razak Dawood said that market and product diversification is the best way to jack-up the exports. He said that our export of traditional items to non-traditional markets has increased 60 percent while export of non-traditional exports to non traditional markets has gone up by 77 per cent during last three years.
The Advisor to PM said that the government is going to introduce DL-TL policy in which extra incentives will be given on the exports of non-traditional products. The government is also going to sign TIR convention with Afghanistan for free movement of trucks to Central Asian States and other parts of this region.
He said that the government is targeting Central Asian Region to boost national exports. Government is also going to implement Look Africa Policy and an official delegation will visit Nigeria next month.
Abdul Razak Dawood said that the Temporary Economic Refinance Facility (TERF) of the State Bank of Pakistan which was expired in March that will be restored for SMEs and other targeted sectors.
The Advisor said that the Engineering and Iron & Steel sectors will be next area of focus for tariff rationalization. To a question, he said that IMF is the major hurdle for sales tax rate reduction. He said it is demand of IMF that Regulatory Duty should be imposed on everything.
“As far as GSP Plus Status and Basmati Rice are concerned, the things are well under control”, he said and further added that though there are challenges but these are far less than the past three years.
He said that the import cost is increased due to inflation at international level. Oil imports have been increased in term of value. He said that the Lahore Chamber will be given representation in Export Development Fund Board.
Speaking on the occasion, LCCI President Mian Nauman Kabir said that the Lahore Chamber has always advocated the effective utilization of Export Development Fund (EDF) in consultation with the important stakeholders of the economy. However, LCCI has not been given representation in the EDF Board. Considering the paramount importance of LCCI as an important stakeholder in our economy, it should be given adequate representation in the EDF Board.
He said that the issue of a steep rise in trade deficit needs urgent attention of the Government. In the first quarter of the current financial year (July-September 2021), the trade deficit stood at 11.66 Billion Dollars – that is 100.6% higher as compared to the trade deficit in the same period last year. This recent increase in trade deficit has played a strong part in the devaluation of rupee. In the short term, we would urge the Government to immediately implement currency swap with China from where our imports amount to around 13 Billion Dollars.
Mian Nauman Kabir said that for curtailing trade deficit, the customs duties and regulatory duties on luxury and non-essential items should be increased so that we can manage our import bill. It is worth mentioning that our imports in the first quarter of this financial year have crossed 18 billion dollars.
He said that Pakistan’s export products are heavily concentrated in a few products lines as textiles, rice and leather account for almost 70% of our exports. There is a need to diversify our exports, especially focusing on potential sectors like Pharmaceuticals, Engineering Industry and Halal Food etc. He recommended that these potential export sectors of the economy should be completely zero rated so that their export competitiveness can be increased.
