Trade deficit

This refers to the letter, ‘What about exports?’ (Jan 13), by Engr Riaz Akbar. The export package of Rs 180 billion announced by the government, after a long delay, works out to just 8.5 percent of the total export proceeds of Rs2.1 trillion. The size of the package is miniscule considering that our rupee is overvalued by 10 percent, production cost is higher due to energy prices and other inputs. This is inadequate to push up exports and compete with the countries in the South Asian region.

Keeping in view the government’s adverse fiscal position due to fall in tax collection and widened budget deficit, exporters are skeptical that the announced package will even be disbursed in full. Additionally, no steps have been taken to cut import of luxury and non essentials goods to reduce the staggering trade. The country’s external sector is facing serious crises but the government is not taking serious steps to tackle such situation.

Arshad M Khawaja

Karachi