Benchmarks for export growth
The Chief Executive of the TDAP, Tariq Puri has indicated that Pakistan’s exports in 2010-11 are likely to cross the US$ 22 billion mark. Trends also indicate that exports may even cross US$ 24 billion by the end of this fiscal year. One reason cited for this encouraging performance is the fact that the country’s crop exports may surge this year as a result of acute cuts in agricultural production across the globe. According to experts, other reasons for the current and anticipated export boom, besides rising global commodity prices, are the government’s decision to prioritize power supply to industry and currency devaluation which has made Pakistani products more competitive. Compared with the corresponding period last year, the Trade Development Authority of Pakistan says that textile exports such as silk have risen by 25.8 per cent while agricultural produce, including basmati rice, was up by 6.2 per cent between July 2010 and February 7, 2011.
The textiles sector, which is one of the key drivers of the economy, accounts for 55 per cent of the country’s entire exports and employs 38 per cent of the national workforce. The situation in this sector has changed dramatically and textile exports are expected to rise by 10 per cent in fiscal year 20102011. With the rising demand for Pakistani products in the global market, industries are also employing more workers. While the Asian Development Bank has forecast GDP growth of 2.5 per cent for fiscal year 2011 in light of the massive losses caused by the 2010 floods, it has predicted a relatively modest rebound of 3.7 per cent GDP growth for fiscal 2012.
The Trade Development Authority of Pakistan as the successor organization to the Export Promotion Bureau (EPB) is cognizant of the series of problems that Pakistan’s export prospects are still faced with despite an improving export performance. Among these are the fiscal deficit which is much higher than the target of 5.3 per cent because of the government’s heavy borrowing from the central bank, the uncertain security situation which is driving foreign and local investors away and an acute energy crisis that restricts production to a large extent. Despite all these setbacks, the TDAP is still highly optimistic and is making intense efforts to create direct linkages with local and foreign stakeholders and aims to achieve a ‘Quantum Leap’ in this respect.
The country’s efforts towards trade promotion are based on the Trade Policy announced for 2009-2010, which has set many vibrant benchmarks. These include providing greater opportunities for gainful employment, setting up a sound macroeconomic framework for trade, investment in improved human resources, promoting the private sector as an engine of growth and focusing on the small scale sector, particularly in agriculture. In this backdrop, the overall dynamics of the country’s export economy can certainly benefit with useful guidance and facilitation from the TDAP, provided judicious use is made of the road map laid down by the trade policy