Commerce Minister Humayun Akhtar Khan recently
announced the Trade Policy 2003-04 envisaging exports target at $12.1
billion and imports at $12.8 billion. During 2002-03, exports stood at
$11.350 billion and imports at $12.2 billion. Trade deficit of $700
million is expected in the current financial year against $1.6 billion
of last fiscal year.
The minister unfolded salient features of the
policy in his nationwide speech on TV and Radio. Earlier the federal
cabinet approved the Trade Policy, which carries a number of
incentives for the traders.
The projections are based on assumptions that
exchange rates will remain stable in 2003-04 there will be greater
access to export finance and that domestic and external environment
will not face any new challenges. The government expects to achieve
exports and imports target to reduce trade gap.
The commerce minister unfolded an export strategy
to achieve projected exports target for the current fiscal. The main
features of the strategy include reducing cost of business, better
market access, technology skills up-gradation, social, environmental
and security compliance, encouraging export-oriented foreign
investment, region-specific strategy, country and business image
building, capacity building of exporters.
Under the policy, an upgradation fund is to be set
up to finance initiatives for technology upgradation, social
environmental and security compliance, setting up of waste water
treatment plants, establishing agriculture export processing zones and
hiring consultants in professional marketing.
The funds will be managed through public-private
partnership and the Government of Pakistan will provide 3.74 billion
rupees for the purpose. It has been decided that for technology
upgradation and export marketing, consultancy services will be
provided at the enterprises level on fifty-fifty cost sharing basis
from the upgradation funds.
The policy provides for setting up of five more
industrial clusters for sports and surgical goods in Sialkot; for auto
parts in Karachi, for electrical appliances in Karachi and Lahore and
for knitwear in Karachi and Lahore.
Ginners will be provided financial support out of
upgradation fund for improving ginning process. The new trade policy
envisages setting up of Export Promotion Bureau office at Gwadar and
publication of a directory of IS certified companies in Pakistan. The
Commerce Minister said it has been decided that WAPDA and KESC will
allow off-peak hour rates for industrial consumers to reduce the cost
of electricity for the industrial sector. A package of incentives has
been offered to recognise and reward exporters who achieve higher
performance in exports. It includes grant of civil awards and Prime
Minister's Gold Medal.
A WTO directorate will be established in the Export
Promotion Bureau with the purpose to create awareness amongst
stake-holders and getting feedback on WTO related issues.
He said Agricultural Export Processing Zones are
proposed to be set up at Sargodha, Rahimyar Khan, Mirpur Khas and
Peshawar. Two special export processing zones will be set up at
Karachi and near an industrial city of Punjab to focus on textile
sector particularly in dyeing, processing and finishing sectors.
An Apple Treatment Plan would be established at
Quetta for grading, polishing and packaging of the fruit. He said a
comprehensive plan would be prepared to promote shrimp farming in
The trade policy 2003-04 has generally been hailed
by the business community. They have welcomed the various incentive
offered saying that the export target for the current fiscal year will
easily be achieved. They are of the opinion that the new trade policy
has provided vast opportunities for the business community and laid
down a future line of action for them to grow and groom in the coming
The new policy can certainly be described as a
major step towards reducing the trade deficit by maximising exports.
Among the salient features of the policy are the establishment of
industrial clusters and export processing zones, creation of a fund
for technological upgradation, setting up garment cities to meet
growing international competition and opening of warehouse abroad.
While announcing the policy, Commerce Minister Humayun Akhtar Khan
also pointed out on export promotion strategy. This includes, he said,
reducing the cost of doing business, increasing market access,
improvement of technological skills, social environment and security
compliance, encouraging export-oriented investment, regional specific
strategy, country and business image building, capacity building of
exporters and greater value-addition. The policy also carries a number
of new incentives for the exporters which should help them in boosting
exports. The diversification of export goods and markets remain its