Government eyes $61 billion export revenue in next five years

ISLAMABAD: Pakistan eyes more than $60 billion in exports revenue in the next five years, betting on a double-digit growth in outbound shipments so far in the current fiscal year, but industry officials linked the target with ease of doing business.

Ministry of Commerce on Wednesday arranged consultative meeting with relevant stakeholders, including representatives from chamber and commerce in order to get their inputs for promoting foreign trade in years to come.

They discussed the three different scenarios under Pakistan’s strategic trade policy framework (STPF) for 2018-2023.

If the country achieves only 10 percent annual growth in exports the revenue could go up to $36.21 billion over the next five years. If exports grow 15 percent a year the foreign revenue could increase to $47.28 billion. But, with 20 percent annual growth, Pakistan’s exports could touch $61.03 billion over the next five years.

Exports started to pick up in the range of 10 to 11 percent in the first seven months of the current fiscal year. However, the overall performance of exports remained dismally low and stood at $20.4 billion in the last fiscal year of 2016/17. Exports had actually declined from $24 billion to $20.4 billion in the last four-year period.

The STPF for 2018-2023 is expected to be presented before the federal cabinet in May 2018 just ahead of the next general elections.

Any policy framework for promoting country’s trade without ownership of upcoming government will pose question mark that how effectively the policy framework will be implemented in the next five years. However, the policy makers said the trade issues need to be looked beyond political divide and the same policy might be fine-tuned after the next government comes to power.

Federal Secretary Commerce Younus Dagha told the participants of the consultative meeting about the preparation of STPF for 2018-2023. He said the new policy would provide more incentives to small and medium enterprises and women entrepreneurs.

The STPF for 2018-2023 will be comprised of eight basic fundamentals, including institutional strengthening, investment linkages, service strategy, product development and compliance, gender mainstreaming, market access and regional connectivity, trade facilitation and finally trade promotion and branding.

Vice President Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Karim Aziz Malik said the electricity tariff in Pakistan is 22 percent high as compared to other regional states. Malik said government will have to reduce cost of doing business in Pakistan in order to maximise competitive edge. He also called for reduction in tax burden on export oriented sectors.

FPCCI Vice President said the trade deficit widened because of free trade agreements especially with China and Malaysia. He demanded of the government to provide the same incentives to Pakistani businessmen in upcoming special economic zones as being provided to China under China Pakistan Economic Corridor.

Commerce ministry’s top officials, including Director General Trade Policy Nauman Aslam and senior official Mohammad Ashraf briefed the participants about the government measures after listening to their views.

The ministry has so far held nine consultative meetings at different places across the country in order to incorporate views of stakeholders for preparation of the new policy framework. The process kick-started in October 2017 and scrutiny of proposals will be done in the current month. The intra and inter-ministerial consultations will be done in March 2018 and the first draft of the upcoming policy will be ready by April 2018. The SPTF for 2018-2023 will be tabled before the cabinet for approval.

On the implementation of last SPTF from 2015-2018, the ministry officials told the meeting that restructuring of ministry of commerce, Trade Development Authority of Pakistan and Pakistan Horticulture Development and Export Company is underway, while placement of Intellectual Property Organisation under the commerce ministry has been implemented. Government is also strengthening skill development institutes and creating new export councils for rice and pharmaceutical products. But, there has been a medium progress on payment of stuck tax refunds.

Ministry officials said reasons for slow implementation of last SPTF were its nine-month delayed announcement, late publication of statutory regulatory orders/circulars and inherent flaws in business procedures.