In a major policy decision, Prime Minister Yousaf Raza Gilani on Saturday directed the Ministry of Commerce to focus on neighbouring countries India, Iran, Afghanistan and China and regional states of South Asia, Central Asian Republics and Gulf Cooperation Council (GCC) for boosting Pakistan’s exports.
Gilani also said a conference of Pakistani ambassadors and trade officers would be held soon to give them the task of pursuing trade diplomacy for increasing exports in the countries of their accreditation. He said their performance would be evaluated on the basis of their success in enhancing the trade relations and exports at the same time. Gilani was chairing a meeting on the Trade Policy 2011-12, which approved the recommendations of Commerce Ministry.
The policy would be presented for the consideration to the Economic Coordination Committee (ECC) of the cabinet and is likely to be announced by the Commerce Minister next week after its approval. An official source said the Ministry of Commerce projected conservative estimate of $26 billion for this fiscal years exports, even though Pakistan was likely to get trade concessions this year from the its main trading partner European Union (EU). Implementation on the trade concessions was delayed due to the opposition of India at the WTO, but New Delhi has recently decided not to oppose the move.
Despite devastating floods and chronic energy problems, Pakistan’s export last fiscal year increased by 28.7 percent to reach a record level of $24.8 billion. The increase in exports was mainly attributed to the increase in commodity prices in the international markets that caused a positive impact on the country’s main export, textiles. The Ministry of Commerce estimates less increase in exports in the current fiscal year due to the international debt crisis and persistent energy shortages and volatile law and order situation in the country.
An official said Gilani directed the Commerce Ministry to chalk out a strategy for taking benefit from various bilateral and multilateral trade agreements signed by the government. It was pointed out that despite having many free and preferential trade agreements with neighbouring and regional countries, the actual trade potential remained unutilised due to the non-trade diplomacy of the concerned diplomatic staff.
Pakistan has free trade agreements (FTA) with Sri Lanka, China, Malaysia and South Asia Free Trade Area (SAFTA) has preferential trade agreements (PTA) with Iran and Mauritius. Despite all these agreements the country has not managed to diversify its exports to these countries. Pakistan is also negotiating on second phase of FTA with China, Singapore, Mauritius and GCC, and PTA with Indonesia, Turkey, D-8 countries and OIC.
Pakistan-Sri Lanka Comprehensive Economic Partnership, and ECO Trade Agreement (ECOTA) are other initiatives for greater market access in Asia Pacific region.