The new trade policy sets the export target at $22.10 billion and limits the country’s imports bill to $30 billion as compared with the last year’s $39.97 billion. At the same time, the policy eases restrictions on import of various items from India.
Federal Commerce Minister, Ch Ahmed Mukhtar announcing the trade policy on the state TV said, “Cheaper raw material from India will make Pakistan’s exports more competitive in the international market. The trade policy will allow the import of diesel and fuel oil from India to also help address the growing trade deficit.”
The government has decided to allow the import of machinery or equipment for mining, quarrying and grinding of minerals from India, he said. In the new trade policy, importable items like CNG buses, stainless steel, cotton yarn, academic, scientific and professional books, specialised printers, laminators and rollers would be allowed from India.
The import of these items from India would also help address the trade deficit, said the policy. In order to enhance exports of minerals and rice, the new trade policy will also allow imports of mining and paddy machinery from India.
The minister said if we look at the performance of various export sectors in comparison with the available detailed figures for 11 months from July 2007 to May 2008 during the same period of the previous year, there was an overall increase of $1.755 billion.
The minister had earlier postponed his press briefing scheduled for Saturday on the direction of the prime minister in view of the prime minister’s first TV address to the nation. However, he asked the media men to attend the briefing soon after the PM’s address. Later, briefing the journalists at the Prime Minister Secretariat, the minister emphasized the need for effective measures to arrest the growing gap in trade deficit affecting the economy. He attributed a number of unavoidable factors, which contributed to the deficit gap to rise to $20.7 billion.
“We inherited a very difficult economic situation where the public is facing more hardships than it has in the recent history,” he said. This was due to external and internal factors of the past year, he added. Moreover, the commerce minister said the doubling of international oil prices from around $68 per barrel to $145 per barrel during the year and increase in international prices of food items Pakistan needed to import during the year, especially wheat and edible oil, enhanced the import bill.
“The total imports during the year 2007-08 amounted to $39.97 billion, raising the trade deficit of $20.7 billion”, he added. He emphasised the need for promotion of regional trade, which according to him, was the only way to reduce freight and trade deficit.
The new trade policy for 2008-09 enlarges the list of importable items from India, which is based on the requests of stakeholders. The list will be issued separately later. About giving Most Favour Nation (MFN) status to India, he said it did not suit Pakistan as India had technical and other trade barriers whereas Pakistan did not have such restrictions.
When asked about R&D scheme for textile, the minister who also has additional charge of commerce & textile ministries said that he would hold a meeting with the prime minister today (Saturday) and hopefully, the issue would be settled.
Imports measures: To any Indian manufacturer of CNG buses who makes a firm commitment to establish manufacturing unit of such buses in Pakistan, the commerce ministry may provide special dispensation for import of 10 buses by road via Wagah from each possible investor as test consignment.
Under TR scheme, import of buses not more than 10 years old are allowed. This facility will help the returning overseas Pakistanis with limited means to create an economic opportunity for themselves as well as ease the shortage of such buses on inter-city routes.
Imports of used cryogenic containers/cylinders by industrial consumers, cement trailers, without prime movers in second-hand/used condition, prime movers with age limit of 5 yeas and minimum fleet requirement of 5 prime movers were also allowed.
In order to reduce the cost of raw material imports and thereby make the country’s indigenous export products more competitive, the import of job lots and stock lots of raw material, which attracts duty up to 5pc would now be allowed.
Similarly, imports of old/used waste disposal trucks of municipal bodies (the imported trucks shall not be older than 10 years) will also be allowed. Stainless steel and cotton yarn is importable from India by train. In order to further reduce the cost of doing business, it has been decided to allow their import by trucks through Wagah as well.
Import of academic, scientific and reference books, specialised printers, laminators and laminator rolls used for printing visa stickers and passports by Nadra would be allowed from India. Only recognised manufacturers would be allowed to import crude palm oil for further processing and refining. Furthermore, manufacturers who import palm oil in crude form will not be allowed to sell it to non-manufacturers. However, commercial importers who have invested in large bulk storages will be allowed to continue importing crude palm oil subject to a safeguard mechanism to be drawn up by FBR.
Import of CFC-based compressors remains banned. The imports of rollers would be allowed, but not more than 10 years old, and the capacity should not exceed 12 tons. Export measures: As export enhancing measures, the new trade policy suggests the intensification of market intelligence, trade promotion, enhancing competitiveness, coordination with other public departments, improving physical infrastructure, discouraging subsidies, diversification and encouraging quality.
Plant, machinery and equipment imported to set up a unit in DTRE scheme will be exempt from duty and taxes. Import of inputs for DTRE will also be allowed from India, even if these are not included in the importable items from India, or manufactured locally.
To increase the exports of gem and jewellery and to encourage investment and remove all anti-export biases, gold, silver, platinum, palladium, diamond and precious stones would be exempted from levy of customs duties and sales tax.
Exporters are allowed to send $25,000 worth of samples to foreign buyers. Since automobiles have higher unit value therefore it has now been decided to increase the limit to $50,000 in the case of automobiles.
The TDAP with its revamping would also establish new clusters of surgical instruments, gloves and personal protective equipment, sports wear, leather & leather products in Sialkot and Charsadda, weaving and textile processing sector in Faisalabad, light engineering sector in Gujranwala, auto parts in Lahore, ceramics in Multan and Halla, ajrak and bangles in Hyderabad/Halla and embroidery in Balochistan.
APP adds: Earlier, the federal cabinet in a special meeting with Prime Minister Syed Yousuf Raza Gilani in chair approved the Export Policy 2008-09 emphasising increase in country’s exports.
The cabinet also approved in principle the establishment of NFC University of Engineering and Technology in Multan to cater for ever-increasing demand for higher education of students of Southern Punjab.
The prime minister had announced the up-gradation of the Institute of Engineering and Technology Multan in May. Presently the Institute of Engineering and Technology Multan is affiliated with Bahauddin Zakriya University and is conducting B.Sc courses in the disciplines of Chemical Engineering and Computer Engineering. The Higher Education Commission recommended the up-gradation of the institute to the status of university level as a degree awarding institution.
Source-paktribune.com
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