KARACHI – Despite the public announcement of various types of subsidies on the export of different items, Trade Development Authority of Pakistan (TDAP) has failed to pay billions of rupees to exporters due to the non-release of funds from Ministry of Finance (MOF), sources have revealed.
Though a large number of exporters have applied for the announced subsidies, aimed to promote the country’s exports under ‘New Trade Initiatives’ of TDAP, the authority has not paid a penny to the applicants for the last one year, sources told Pakistan Today. With the authority yet to receive around Rs 7.0 billion under export development fund from MOF, it was not only unable to pay the subsidies under different heads to the exporters but also many projects including the establishment of warehouses and retail outlets abroad were also not being completed as resources have dried up, they added. Though the authority which is the subsidiary institution of Ministry of Commerce, has announced various subsidies to promote the country’s exports, the exporters of many sectors have started to voice serious concerns over the commitment of TDAP to their declared program, as they have not paid announced incentives for the past two years.
Pharmaceutical and cement exporters have claimed millions of rupees in subsides from TDAP but the authority has yet to clear the declared dues to the respective sectors. Despite the announcement of around 35 percent of inland cost from the government, the payment of over Rs 350 million is yet to be set as a subsidy to the cement exporters for the past year due to the unavailability of funds, they said.
The authority had earlier announced a 50 percent subsidy to leather apparel exporters for floor expert advisory/ consultancy services during February last year, while accepting the burden of a 25 percent share in the cost of design studies in tanneries, announced in November 2009.
In another category of subsidy, TDAP had also announced 25 percent freight subsidy on the export of live seafood, and markup subsidy for cool chain projects, in October 2009. TDAP had also announced the 50 percent sharing of cost on each Halal certification and UL certification last year beside a six percent support on the export of processed food in 2009.
Furthermore, the authority had also announced inland freight subsidy a range of products including cement, light engineering, leather garments, furniture, soda ash, hydrogen peroxide, caustic soda, sanitary wares including tiles, finished marble/cut to size marble blocks/ granite/onyx products.
Beside the subsidies announced under the trade initiatives of 2009-2010, the authority had also committed to organize the support for opening of export offices, retail outlets, and warehouses abroad to promote the country’s exports. The other initiatives included a matching grant to leather apparel exporters to establish design studios/centers, equivalent grant for the installation of flaying machines to district governments and setting up of effluent treatment plants in individual tanneries, hiring medical representatives abroad, registration of pharmaceutical products, start of bio equivalence certification and brand promotion support for surgical instruments, sports goods and cutlery during the last two years. The authority also announced one percent Adhoc Relief in June 2010.
