Mohammad Arshad Islamabad
Adviser to Prime Minister on Commerce and Investment Abdul Razak Dawood has said that export of goods have grown by 18 % to $ 25.3 billion during FY 2020-21 which is the highest ever in the history of Pakistan.
The exports on June 2021 were also the highest in any month in our past, at $2.7 billion. The exports of Services for the year also projected to be $ 5.9 billion.
The cumulative exports of Goods and Services during FY 2021 will therefore cross USD 31 billion.
The Adviser to Prime Minister on Commerce and Investment, Abdul Razak Dawood said that it is a remarkable achievement by our exporters considering the difficulties created by Covid-19 at home and resultant contractions in our major markets.
It was not an easy task as many countries went into lockdown, and severely affected the business. Not only our exports survived the crisis but also we have enhanced it in many sectors. I salute our exporters on achieving the milestone.”
The Ministry of Commerce (MOC)’s Tariff Policy Board was formed under the National Tariff Policy with the major objective to improve the competitiveness of the Industry through gradual reduction of Customs Duty (CD), Additional Customs Duty (ACD), Regulatory Duty (RD), time bound tariff protection to strategic & import substitution industries and simplification of tariff structure and procedures.
Since 2018-19, tariff on more than 4000 inputs (i.e. raw materials, intermediate and capital goods) have been rationalized. As a result, almost 40% of total inputs in terms of number of tariff lines as well as value of imports are at 0% duty.
This has improved competitiveness of the industry witnessed in 13% growth in LSM and 17% increase in exports despite Covid pandemic.
In the current budget 2021-22, major rationalization in textile value chain, iron & steel raw materials for all kind of flat products, pharmaceutical raw materials, machinery & equipment, inputs for footwear, glass, poultry, food processing industry would further lead not only to revival of industrialization in the country but also enhanced exports. With the current measures exports are expected to grow by 5% in next two years.
Tariff rationalization efforts in last two & a half years have brought trade weighted average tariff of Pakistan down from 9.07% in 2018-19 to 7.07% in 2021-22.
Thus bringing tariff at par with the regional competitors, reducing the cost of manufacturing, generating employment, attracting new investment, and enhancing consumer welfare.
Tariff reforms will continue in the coming years. It is planned to study, analyse and reform tariff structure of the agriculture and transport & logistics sectors next year.
Time-bound & phased out protection to import substitution industry, further reduction in overall tariff including CD, ACD & RD and simplification of tariff structure will continue.