Cabinet okays policy framework for boosting exports

ISLAMABAD: The federal cabinet on Tuesday approved the Strategic Trade Policy Framework (STPF) for five years from 2020-25, envisaging three different scenarios for boosting Pakistan’s made-up exports ranging from $29.1 billion in 2021-22 to $40.2 billion till 2024-25. However, the Ministry of Commerce fixed its targets to fetch exports on the higher side ranging from $31.2 billion in 2021-22 to $57.03 billion till 2024-25.

Related to Pak-India bilateral trade, the STPF envisages the elimination of the 200pc MFN duty imposed by India on Pakistan’s exports, (causing serious impact on exports of dried dates, which amounted to $90 million in the last year) within one-year period. To protect local pharmaceutical manufacturers against import dumping by India, the National Tariff Commission (NTC) recommend anti-dumping measures. To review the South Asia Free Trade Agreement (SAFTA) and import duties of all importing countries, particularly Bangladesh which has levied very high duty on Pakistani origin products (up to 90pc on fans), it was excluded from the sensitive list of SAFTA.

For addressing industry concerns on certain chemical products under phase-II of the Pak-China FTA, the government has envisaged imposing Regulatory Duty (RD) within the next 6 to 12 months period. To expedite the resolution of quarantine issues, it was proposed to get permission from AQSIQ China to help meat exporters from Pakistan to take advantage from zero rate under CPFTA Phase-II. Accessibility of the Chinese market for Pakistan meat products as export of meat to China is disallowed unless the meat is semi-processed with heat (livestock in Pakistan is prone to transboundary diseases, foot & mouth disease).

The government has also planned crackdown on smuggling/ misdeclaration (quoting correct weight but incorrect area) through Iran and China FTA. The Export Development Fund (Amendment), Act 2005 stipulates entire receipts of Export Development Surcharge (EDS) collected by the federal government in the preceding year shall be transferred to Export Development Fund (EDF) in the following year. Currently, only around 20pc of the total annual receipts from EDS are being transferred each year by the Ministry of Finance to EDF. Beginning from FY2020-21 and henceforward, the entire amount of Export Development Surcharge will be transferred to the EDF. As per the export projections for next five years under STPF 2020-25, it can be safely estimated that EDS worth around Rs75-80 billion will be collected in the coming five years.

The 18pc decline in Pakistan’s share in global market during the last decade means that Pakistan’s export competitiveness in the global market is eroding. The regaining vitally depends on the restoration of Pakistan’s export competitiveness. The Ministry of Commerce has identified reduction in cost of doing business for exporters to be more competitive and productive, reduction in transaction costs through efficient logistics, seamless administrative procedures, fewer documentary requirements and less dwell time at ports.