PR Resource – Muarateweh.net

Trade promotion strategy of the country has not kept pace with the changing global and local environment which has impeded the ability of exporters to fully exploit potential markets.

Economic experts regret that the previous government ignored the swelling imports simply because it could manage the trade deficit by selling the ‘family silver’ to foreign investors. What surprises them more is that the present regime has also not taken any step to put a brake on excessive imports. They say if the trade gap in July, the first month of this fiscal year, is an indicator then the deficit might cross $25 billion this year.

Faisal Qamar, a chartered accountant, commenting on the issue says the economy will completely slip out of government’s hands if some drastic measures are not taken immediately to reduce imports and accelerate exports. In recent years, he says, the Trade Development Authority of Pakistan and to a lesser extent the Engineering Development Board have been trying to promote exports through participation in international trade exhibitions. On the other hand, he adds, the Ministry of Commerce and the Ministry of Textiles have been striving to resolve the issue of high cost of doing business in the country keeping in view the facilities provided by competing economies for their exporters.

He says the TDAP is the changed name of the Export Promotion Bureau and the decision-making process there is extremely slow. Export promotion strategies are basically fine-tuned to benefit textile and other traditional exports, which has impeded the promotion of engineering products’ exports, he points out.

However, he adds, the TDAP alone cannot be blamed for this issue. The Authority receives around Rs900 million annually from the government and after covering its operational expenses of Rs450 million, it is left with Rs550 million for export promotion through participation in foreign affairs.

The allocated amount has remained the same for the last few years, he says, adding when the dollar was worth Rs55 the amount equaled $100 million and now that the dollar has increased to Rs75 this amount has come down to $73.3 million.

With costs rising globally, the ability of TDAP to participate in foreign fairs has weakened, he says and suggests the allocation for promotion of exports should be in foreign currency instead of rupees.

An entrepreneur in the engineering sector says exports of engineering goods can only be possible if the engineering industry of the country is introduced in foreign exhibitions in a big way. “For high value-added exports, you need aggressive trade promotion as foreign buyers will not take engineering companies seriously if they participate in international fairs in small cubicles.”

He points out that the participation of engineering firms in Hanover fair for three years on funding provided by the EDB has started bearing fruits.

However, with the change of guard at the EDB the plan for participation in exhibitions next year is unclear, he says and warns all the good work done by the Board in the past three years will be wasted if Pakistan fails to show up in international engineering fairs next year.

Giving his views, a textile exporter says the government should speed up its decision-making process and regrets that a notification on research and development facility for different textile exporters has still not been issued. He says the government should remove the uncertainty in this regard by coming up with a clear policy.

The industrial sector says the government should complete its economic team on an urgent basis so that matters impeding exports could be taken up collectively with it and adds the increase in dollar value against the rupee has abnormally enhanced the cost of projects based on imported machines.

The industries ministry, it suggests, would have to find a way to reduce the cost of green industrial projects so that the export base could be widened.

By Mansoor Ahmad, The News