Monday, May 12, 2008, Jamadi-ul-Awwal 5, 1429    

Govt plans to sign more free trade pacts

Karachi—Federal Commerce Minister Shahid Khaqan Abbasi said here that the government would initiate free trade agreements (FTAs) with various countries. Foreign investors would also be invited to set up industries for boosting economic activities so that the country could be put to the road of progress, the minister said while speaking at the South-Asian Tax Summit 2008. The minister said that the country was facing many problems, including power shortage and fiscal and trade deficits.
He said that numerous serious economic and social problems, inherited by the new government, would be handled on short- and long-term basis. The summit was jointly organised by the Income Tax Bar Association, Karachi (ITBAK) and some other professional and trade bodies. Federal Board of Revenue (FBR) Chairman Abdullah Yusuf said that trade liberalisation and regional cooperation under Saarc framework holds a promise for growth and development in member nations. However, it poses a serious challenge to the taxation structure in the economies of the region.
As trade barriers come down and capital mobility increases, challenges for South Asian countries would become acute because of their dependence on foreign trade taxes, he said. He, however, cautioned that even on reducing trade tariffs, regional countries would have to concentrate on three major tax policy areas which would include revenue consequences of trade reforms with reduction in foreign trade taxes.—APP