PBC urges PM to ask China for preferential duties in upcoming visit

KARACHI: The Pakistan Business Council (PBC) has suggested Prime Minister Imran Khan in his upcoming visit to China

recommend preferential duties on Pakistani products, which if approved can harness nearly $3.8 billion additional exports per annum.

In a letter written to Prime Minister’s Advisor Abdul Razzak Dawood, the PBC said preferential tariff would increase exports to China. The government of China has granted favourable tariff regime for Bangladesh and ASEAN, a statement quoting the letter said on Tuesday.

Bangladesh is part of China’s LDC (Least Developed Countries) scheme, which allows it duty free access on 97 percent of the tariff lines, while ASEAN-China FTA offers zero-duty on 90 percent of the products exported to China.

It said that the export potential was measured as the difference between what China currently imports on these lines from Pakistan and its total imports from the world, subject to Pakistan’s current capacity to supply, as measured by its total exports of the same line to the world.

Out of hundreds of products handled by Pakistan, China, ASEAN and Bangladesh, PBC pointed out 25 products, which include milled rice polished and glazed, fish, trousers for men and women, yarn of different thickness, shirts, t-shirts, leather jackets, and cotton yarn.

The council explained that 25 products, which were imported by China, constituted to around $9.761 billion per annum,

while Pakistan’s share was around $800

million.

On these products, the country’s exporters paid duty ranging from 3.50 percent to 65 percent, it said.

However, the PBC said the ASEAN exporters received zero-rating on 18 of these same 25 items, and Bangladesh, which had the Least Development Countries status, was given zero-rating on 16 products.

The government should table these proposals in the upcoming visit proposing preferential trade agreement to help enhance the trade to around $3.7 billion from the present level of $800 million, the PBC said.

According to an analyst, the government instead of asking for hefty loans from brotherly countries and especially China should urge these countries to give Pakistan access to their markets, which would have a chain impact on the economy.

This additional $4 billion worth of exports would help boost the large manufacturing sector, shrink trade deficit, generate employment, improve revenue collection, and above all better the image of Pakistan in the world trade market.