Faced with the dwindling exports for the fourth consecutive year in office, the Commerce Minister Khurram Dastgir has directed the commerce officials to shift the focus of traders towards those countries with which Pakistan has Free Trade Agreements (FTAs).
An official source said that the Rs 180 billion package of incentives given by the prime minister for the export sectors earlier this year has shown a slight improvement in exports during the last five months. However, the Rs 110 billion revenue concessions for the 18-month package has so far not enthused the required spirit in the industrial sector.
The government is not likely to provide any major concessions to the textile sector in the budget for the next financial year, but it wants the sector to show some propelling activity in the export sector. The government wants results before the next general elections, the source said.
It is important to mention that the government is planning to sign an FTA with Thailand by August-September this year, while FTAs with Turkey and China will take more time to be negotiated.
The government wants a substantive increase in exports with countries with which FTAs are already in place, as it was pointed out that the exporters were not fully utilising the options available to them.
Commerce Minister Khurram Dastgir chaired an important meeting that reviewed the progress on the Pak-Malaysia Free Trade Agreement. It was pointed out that major Pakistani exporters have ignored the Malaysian market and very less effort has been made to market their products.
The minister said the Pakistani exporters must focus on the Malaysian market. He said that though all major and principal Pakistani export products such as textile, surgical and leather enjoy zero tariff rates but still this market is being ignored by Pakistani exporters.
The commerce ministry is working on the FTA with Malaysia to take more concessions for Pakistani exporters and for including more and more items in the FTA but the principal export items already enjoy a full-market access in Malaysia and the need is to take maximum possible advantage from of it, the minister said.
The minister was informed that Pakistan has offered tariff concessions to Malaysia in 6083 tariff lines while Malaysia has offered concession to Pakistan on 10576 tariff lines and out of the total, 74 per cent (7914 tariff lines) enjoy “zero” duty which includes most of the principal export items of Pakistan.
Under the agreement, a Joint Review Committee (JRC ) has been established to monitor the progress of the agreement and till now, three meetings of the JRC have been held. During the 2nd meeting, both sides agreed to adopt amendments to Chapter 3 on Rules of Origin (ROO), and its corresponding Annexes 3 and 4 of MPCEPA.
During the 3rd Session JTC held on 27th -28th September 2016, in Kuala Lumpur, both sides agreed that initially, the expansion will take place in form of an Early Harvest Programme, which envisages further immediate concessions on 10 items. It was further agreed that both the parties shall accord concessions to items of export interest at par with other FTA partners.
