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Trade policy likely in November

Ministry of Commerce upbeat after APTMA’s successful negotiation. PHOTO: PID/FILE

Ministry of Commerce upbeat after APTMA’s successful negotiation. PHOTO: PID/FILE

ISLAMABAD: The Ministry of Commerce will announce the Strategic Trade Policy Framework 2015-18 in the first week of November this year in an attempt to boost the country’s dwindling exports from the current $24 billion to $35 billion by 2018.

This was stated by Minister for Commerce Khurram Dastagir in a meeting that was called to review the country’s trade performance and analyse the downward trend in exports over the last two years.

“While addressing the meeting, the minister said that the draft of Strategic Trade Policy Framework has been sent to the Prime Minister Secretariat via the finance minister for the former’s approval and is likely to be sealed by him in the first week of November, on his return from the US,” officials told The Express Tribune.

“The delay in approval has been due to disagreements between some stakeholders and the government over certain policy issues,” the officials said. “Successful negotiations between All Pakistan Textile Mills Association (APTMA) representatives and the finance minister have paved the way for the policy draft approval.”

The officials added that the key feature of the new trade policy framework was mainly the sanctions of various sector-specific and area-specific incentives to the business community to improve their exports in terms of value-addition and quantity.

The federal government has earmarked Rs6 billion to the ministry of Commerce for formulating and implementing the new strategic trade policy framework. The minister had earlier stated that the Prime Minister had committed to provide more funds in case the allocated budget falls short.

Some key features of the trade policy framework are to “give incentives on exports from backward areas, incentives on value-addition, region-specific incentives, speedy export refund mechanism on value-addition, incentives on import of machinery that improve value-addition, incentives on textile and associated exports and targeting of new markets like African countries”.

Reasons of declining exports

The ministries identified three key reasons behind falling Pakistani exports over the last two years. The first factor was zero export of Naphtha this year. Naphtha is a petroleum product which was exported to UAE. Since the establishment of their own plants, they have stopped importing Naphtha from Pakistan altogether, causing the country’s exports to fall by $315 million, they said.

The second factor is the imposition of duty on the import of jewelry for export purposes causing the export of consequent value-added jewelry to cease.

The third factor is the slowdown in China.

Published in The Express Tribune, October 21st, 2015.

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