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October 20, 2019

Misuse of EDF: Senate body summons commerce ministry official

National

October 20, 2019

ISLAMABAD: The Senate Standing Committee on Commerce and Textile Industry Chairman, Senator Mirza Muhammad Afridi, has summoned the officials of the Ministry of Commerce to clarify their position after receiving complaints regarding misuse of the Export Development Fund (EDF).

The commerce officials have been asked to appear before the committee on October 22 and bring the record of disbursement made during the last five years and stop disbursements to trade associations unless endorsed by the committee.

It may be mentioned that almost two decades back Export Development Surcharge was imposed on exports without the sanction of stakeholders to boost exports but the cited objective cannot be achieved.

Rather, the allegations of misuse of funds by officials and influential businessmen surfaced repeatedly but to no avail. The exporters have also alleged that some officials use the fund to travel along with their families during holidays.

This was one of the reasons that the Commerce Ministry has denied the Finance Ministry’s request for a third party audit of the fund to keep matters hidden from the public eye.

Presently, the government is deducting one percent on exports as EDF which is over Rs22 billion per annum. The textile sector contributes around 55 percent to the fund, but it gets nothing in the return.

It is worth mentioning that around Rs32 billion were misappropriated in TDAP in the garb of boosting exports in which a former prime minister, former commerce minister, former chief of TDAP and many more were indicted, but the system could not be made transparent.

The Export Development Fund is an autonomous body working under the administration of a Board of Administrators.

The cited aim of EDF is to address bottlenecks faced by the exporters and producers of exportable goods and services in Pakistan with a view to increase the performance of the export sector; however, it has remained subjected to criticism by exporters since long.

The stakeholders say that EDF should invest in export-oriented projects and properly support the establishment of training institutes to develop skills and enhance the capacity of local manpower to support the local industry. Senator Afridi has also asked the commerce officials to give him a detailed briefing on the issue of EDF.

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