Economic managers urge that the role of exports as a significant driver of economic growth in all over the world is well recognized. That’s why every state strives hard to improve its exports capabilities because it directly impact in Gross Domestic Product (GDP). However that is not enough if not matched by equally significant measure — economic diplomacy.
To improve the economic growth of Pakistan, we need to reinvigorate economic diplomacy in our foreign relations, particularly through our embassies. In a global perspective, the trade is chiefly conducted through regional groups/alliances. Pakistan is also a member of such regional arrangements i.e. SAARC and ECO, which have yet to contribute to the promotion of intra-regional trade. International trade has grown manifold in the last 15-20 years with countries namely; India, China, and Bangladesh having increased their exports considerably since 2000.
The overall economic contribution of Pakistan’s export sector should not be underestimated. Traders also mentioned that Pakistan’s exports, for instance, are a main source of foreign exchange earnings and a key source of employment rate. They have also mentioned that the opportunities arising from increased international trade are accompanied by various issues both for exporters and manufacturers. One of these is meeting strict quality and compliance requirements, not only from a product-specific and technical perspective, but also from regulatory, social, environmental, performance, and customer-specific standpoints.
According to the provisional statistics calculated by PBS (Pakistan Bureau of Statistics), exports from Pakistan during December, 2017 worth to Rs214,877 million as compared to Rs208,036 million in November, 2017 and Rs180,321 million during December, 2016 explaining a rise of 3.29 percent over November 2017 and of 19.16 percent over December 2016.
The experts also calculated that in terms of US dollars the exports in December 2017 were $1,977 million as against to $1,974 million in November 2017 explaining a rise of 0.15 percent and by 14.81 percent as against to $1,722 million in December 2016.
Exports during July-December, 2017 totaled Rs1,165,665 million as compared to Rs.1,035,532 million during the same period of previous year explaining a rise of 12.57 percent. Furthermore, in terms of US dollars the exports during July-December 2017 totaled $11,002 million as compared to $9,895 million during the same period of last year explaining a rise of 11.19 percent.
According to the provisional statistics recorded by PBS main products/commodities of exports during December 2017 were knitwear (Rs25,705 million), readymade garments (Rs24,991 million), cotton cloth (Rs19,461 million), bedwear (Rs19,238 million), rice others (Rs18,566 million), cotton yarn (Rs11,722 million), towels (Rs6,939 million), fruits (Rs6,257 million), madeup articles (excl. towels & bedwear) (Rs.6,249 million) and sugar (Rs5,735 million).
The present Government of Pakistan said authorities to ensure continuation of the lucrative EU trade concession status by Generalized System of Preferences (GSP) Plus, chiefly benefiting Pakistan’s textile export industry, beyond 2018. This status, granted from January 2014, allowed almost 20 percent of Pakistani exports to enter the 28-member states of EU bloc at zero tariff and 70 percent at preferential rates.
Experts mentioned that Pakistan was among the nine countries – counting its textile rivals Bangladesh and Sri Lanka – that won the GSP Plus status. However, Pakistan could lose this status anytime till 2023 for noncompliance with anyone of the 27 conventions related to human and labor rights.
Economists also revealed that Pakistan’s exports to EU had recorded 45 percent rise while value-added textile products 88 percent over the previous 5-year. Pakistan desperately needs concessional markets to narrow its ballooning trade deficit, which surged 24.5 percent to $17.963 billion in the first half of ongoing fiscal year of 2017-18.
Balance of trade
According to PBS, based on the provisional statistics of imports and exports the balance of trade figures cumulative from July – December, 2017 were Rs (-) 1,899,720 million and US (-) 17,939 million dollars.
Despite huge strides made by Pakistan in the field of economic development during six decades of existence, Pakistan’s export profile is not as impressive as it should have been. However, the most worrying feature is here reliance on too few exportable commodities and too few trading partners. This narrow base and lack of diversification of exports have made Pakistan vulnerable to external also internal shocks. We have to improve quality of product and must review our export policies.