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Economy

Export package on cards to promote trade of value-added products

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APP
ISLAMABAD: The government is working on a new package to facilitate exporters with a special focus on promoting the trade of value-added products to boost exports from the country.

“The government is working on a new package. Keeping in view the prevailing circumstances, this package will focus on the increase of non-traditional and value-added exports,” official sources said.

Due to the export package of Rs180 billion provided by the government during the fiscal year 2017-18 and the exchange rate adjustments, exports increased by 13 per cent in the first nine months of the current fiscal year and 24 per cent in March 2018, they added.
For the promotion of external trade, the government had introduced many export-promotion incentives that would help promote exports during the upcoming fiscal year and reduce trade deficit to a great extent.Since cotton was one of the major export products, the government has been working with provincial governments to formulate and enforce a policy to halt conversion of cotton growing area into a sugarcane growing area while Plant Breeders Rights Act has been recently enacted to help produce higher yield varieties of cotton and other crops locally through availability of better quality seed.
During the last five years, the government took several measures for the promotion of exports of different sectors, particularly the textile sector.These included reductions in markup rates of long-term financing facility (LTFF) and export refinancing facility (ERF) to historic lows of 5 per cent and 3 per cent respectively, duty free import of textile machinery, uninterrupted supply of gas and electricity for industries, zero-rating of five key export sectors, and introduction of export package of Rs180 billion.
During the upcoming year (2018-19), the government plans to rationalise subsidies and concurrently reduce the cost of production.For the upcoming year, the government introduced a zero-rating regime, freight support on the export of potatoes, reduction in LTFF and ERF rates, Export Promotion Schemes under Textile Policy and Strategic Trade Policy Framework, tariff restructuring and zero rating of import materials for the export sector which will significantly reduce the creation of new refund claims.
To provide an incentive to exports an inter-ministerial review has identified certain raw materials, used in export-related sectors, hence the government would exempt or reduce the existing rate of customs duty on various raw materials.

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