Boosting Pakistan's export

Boosting Pakistan's exports Mega projects in Balochistan Phenomenon of sustainable agriculture

The EPB has been asked to achieve the level of 14 billion US dollars growth by the year 2002-2003

From Shamim Ahmed Rizvi,
Islamabad
Aug 27 - Sep 02, 2001

 

The President General Pervez Musharraf is not satisfied with the present volume of country's export and, therefore, is constantly coaxing all concerned to take measures to boost export significantly. Pakistan's, economic revival plan has laid considerable emphasis on export acceleration and import substitution and the President wants exports to rise to 14 to 15 billion US dollars by the end of 3-year economic revival plan in 2003.

While there has been little or no progress on import substitution during the year 2000-2001, the country's export could not go beyond a little more than 9 billion dollars. As import volume during the current year will depend on the overall demand and world oil prices, export has been fixed at just little over $ 10 billion, But this is not going to be enough. The export earnings will have to be substantially increased to keep pace with economic requirements.

The Export Promotion Bureau (EPB) has been asked to launch an all out national drive for a sustainable growth of Pakistan Foreign trade achieving a level of about 14 billion US dollars by fiscal year 2002/2003. EPB is all geared to achieve this target and evolved a six point strategy for this purpose.

In a recent press interview, Chairman EPB and Minister for State, Mr. Tariq Ikram, unfolded his new strategy to meet the desired objective. He said that based on an evaluation of world demand of goods and services, the strategy aims to prioritise those where Pakistan has or can achieve a competitive edge, sources from within or outside Pakistan and facilitate achievement of the desired levels of profitable exports viz a demand led strategy, as opposed to the previous supply led efforts. The six-point strategy is Enhance world market shares of core products categories via increased penetration of our best performing core product categories in top 10 respective countries. Selectively increased penetration of core product categories in next top 10 countries.

Core categories are textile garments, raw cotton yarn (all types), fabrics, garments, made-ups (excluding towels); towels, art silk & synthetic textiles. Other core categories rice, leather-product, sports goods, carpets & wool, surgical instruments and petroleum products.

Pursue enhancement of manufacturing and marketing capabilities and efficiencies to achieve value addition and increased competitive strength to core product categories. It calls for pursuing with national alignment and focused resource application, selected developmental export opportunities where Pakistan currently enjoys, or can achieve, a strong competitive edge.

The identified categories are fisheries, poultry, fruits, vegetables and wheat, IT software and services, marble and granite, gems and jewellery, engineering goods, chemicals, healthcare, general services. The strategy also emphasises maximising exports to countries where Pakistan currently or potentially enjoys special relationships. These will initially be China, Iraq, Saudi Arabia, Libya, Syria, Egypt, Turkey, UAE, Iran, Oman, Qatar, Malaysia, Indonesia, Central African Republic.

It aims at enhancing market access based on proactive and innovative management of current or emerging world economic-trading blocs and bilateral trading arrangements. These will initially be pursued with EU, ECO, SAARC, OIC, and bilateral trading arrangements.

Mr. Tariq Ikram said; "It is essential that national alignment of all stakeholders be ensured to the need for an aggressive national drive, a quantum leap in exports and also export strategy and availability of an enabling environment. An "Export Hype" needs to be created to ensure desired mindset and action by all stakeholders.

In alignment with the strategic product, geographic needs and international trading regulations, skills, training-technical facilities be enhanced among all stakeholders, especially exporters, Pakistani missions, EPB, financial institutions and SMEDA. "On a medium-term basis, success of Pakistan's exports must heavily rely on strength of our small and medium size exporters" he said.

He said Pakistan's exports in fiscal 2000-2001 were US$9.158 billion with addition of US$18 million export of IT products. "We could not achieve US$10 billion, as rice was abundantly available in the world market. However, our world market share has marginally increased in world market, including the United States. Except for three items all other goods exports to US rose in fiscal 2000-2001. Overall share of developmental items in total exports increased and that is product diversification we are looking for".

He mentioned China with whom Pakistan has special relationship and said there was rise in exports to Beijing by US$160 million in fiscal 2000-2001, which is 71 per cent above last year. Exports to Saudi Arabia were of US$193 million, 25 per cent above last year. In Iran breakthrough was made in rice exports last year.

Likewise, exports to Iraq have increased from US $ 5 million to US$65 million in terms of contracts signed during the last one year, of these goods worth US $20 million were exported to Iraq by June 2001. It is a major breakthrough in diversifying exports to Iraq in terms of rice, wheat, wooded doors, car batteries, GI pipes, stationery, bathroom sets, pharmaceuticals etc. In Africa, Pakistan's share has moved from 4.2 per cent of total exports to almost 5.4 per cent. To Middle East states Pakistan's exports rose from 11.6 per cent to 14 per cent, he added.

According to Mr. Tariq Ikram, Pakistan will have petrol for export due to setting up of PARCO refinery this year. Leather product exports will continue to grow strongly. He underlined need for improved manufacturing and quality control in good developmental products.

"There is need to minimise effects of difficulties and maximise opportunities. There is availability of export credit finance in abundance. Export credit finance scheme facility is available. A window of US $ 150 million can be utilized by exporters to borrow in US dollar and pay back in same currency", he stated.

"We are trying to strengthen export culture by working closely with the Central Board of Revenue. Export facilitation committee has been strengthened to resolve day to day problems of exporters, Complete case of exporters is sent to the committee 15 days before its meeting so that decision is taken". The EPB is also bringing warehousing scheme. Pakistani companies can jointly set up company outside the country to market their products. EPB will contract warehouse space to cost less and allow exporters to use it abroad to enhance export base there like ready stocks. The Bureau will also contract office space and pay rent for use by Pakistani small and medium size exporters for six months.

Mr. Tariq Ikram stressed the need to focus on maximising Pakistan's market share in major markets with a major items as well as enhancing capabilities of manufactures to get value addition. "We need to focus on products having world demand. This is necessary to have competitive edge", he observed.

President General Pervez Musharraf's concern over insignificant increase in our export is fully justified. He has rightly observed that Pakistan's export target of 10 billion dollars was too small as compared to other countries in the region—with Malaysia of 70 billion dollars and other Asian countries having a still higher level. Keeping in view the size of the country, its population and its resources Pakistan exports are disappointingly low.

There is a tremendous scope to increase the volume of our exports and the present government's focus on this issue is a step in the right direction. One of the essential conditions for successfully spearheading export marketing is to make the products attractive enough for foreign buyers in terms of quality in comparisons with similar products from other competing countries. This aspect will gain more importance after 2005 when the WTO regime involving restriction-free access of imports/ exports in the global markets will be fully implemented and tariff restrictions would be phased out. In order to compete successfully on the export from after 2005, Pakistani export industries/ exporters would then have to depend for success on cost efficiency and quality of the products. In this connection, the EPB is also taking initiatives to make the exporters increasingly quality conscious. It is proposed that the private sector should manage its own affairs by constituting quality inspection committees for different types of industries and products with a view to ensuring the quality of exportable goods at international standards.