Govt to spend Rs. 20 bln to enhance exports in three years

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ISLAMABAD, Dec 17 (APP): The government would spend Rs. 20
billion over next three years to enhance Pakistan’s export
competitiveness and institutional strengthening under Strategic
Trade Policy Framework (STPF) 2015-18.
In response to emerging international changes, several other
initiatives are being implemented to enhance export basket and
market share, sources at Commerce Division said here on Saturday.
The sources said total volume of Pakistan’s exports in terms
of billion dollars was 24.5 during 2013 and 20.8 during 2016.
Highlighting the steps taken by the government to enhance
exports, the sources said a sales tax zero-rating regime for five
export oriented sectors, i.e textile, leather, carpets, surgical and
sports goods has been introduced with from July this year.
The other steps were establishment of Export Promotion Council
for Pharmaceuticals & Cosmetics, and Rice Export Promotion Council,
support for import of plant & machinery to strengthen supply
chain and encourage value addition and Performance Based Incentive
(PBI) to offset burden of higher utility costs and local levies and
taxes on export sectors, i.e. per unit price based refund a 4% of
10% over last year’s exports.
The sources said under short-term export enhancement
measures, four product categories i.e. Basmati rice, horticulture,
meat and meat products, and jewellery, are being focused with
parallel focus on markets including Iran, Afghanistan,
China and European Union.
An additional Rs. 6 billion is available this fiscal year to
exporters through Textile Policy 2014.
Policy of uninterrupted energy supply has been implemented
with zero electricity load-shedding on industrial feeders since
October 2015 and zero gas load-shedding for industry since March
2016.
In order to fulfil long, awaited demand for reducing cost of
doing business, the government has taken a major step of reducing
electricity tariff by Rs. 3 for industrial units with effect from
January 1, 2016.
Furthermore, the fuel adjustment has been passed on to
consumers to further reduce cost of production.
The export infrastructure is being continuously improved :
capacity of Lahore Expo Centre has been doubled, ground-breaking at
Peshawar Expo Center and at three 21st-century land ports at
Torkham, Wagha and Chaman is also expected this fiscal year.
The sources said in order to counter import surge through
unfair trade and strengthen trade defence mechanisms, National
Tariff Commission Act has been revamped and approved by
Parliament in 2015.
The leading business support institutions are being
strengthened. Trade Development Authority of Pakistan has recently
been restructured while Pakistan Horticulture Development and Export
Company is being revitalized and strengthened.
Trade Development Authority of Pakistan (TDAP) is undertaking
various export promotional activities through trade exhibitions and
delegations.
The availability of affordable finance for the export
sector has considerably improved.
The State Bank of Pakistan has further reduced discount rate
which currently stands at 5.75%. The Export Finance Rate currently
at 4.5% is the lowest in a decade.
The sources said Exim Bank is being established to
facilitate export credit and for reducing cost of borrowing for
exporting sectors on long term basis. This will also reduce their
risks through export credit guarantees and insurance facilities.
The Board of Directors of the bank have been appointed and
it will be functional after completing the technical formalities.
Moreover, Federal Cabinet has approved resumption of banking
channels between State Bank of Pakistan and Central Bank of Iran,
which will boost Pak rice exports substantially. There is
consistent effort for negotiating additional market access for
Pakistani products in target markets – FTA negotiations with
Turkey and Thailand are at advanced stage, negotiations with Iran
on FTA are being initiated, and joint research study to assess the
potential for a preferential arrangement with Korea is underway.