Govt offers incentives to spur dwindling exports
KARACHI—The persistently low performance of the foreign trade sector, especially exports, have forced the government to offer a wide range of incentives to boost it. The new steps will be effective from July 1the start up date for the National Budget for FY-2017. What outcome of the new tax concessions and incentives is expected? Finance Miniser Ishaq Dar said: “The concessions and incentives aim at achieving the objective of a 25 per cent increase in exports in FY-17.” He said: “We want to increase exports to $35 billion to reduce country’s dependence on foreign loans.”
Explaining the possibility of achieving this target of $35 billion, Dar said: “The exporters, including the textile sector, which is Pakistan’s biggest exporter, promised to us ‘if these concessions and incentives are given to us, we will give you 25 per cent increase in exports.’” But that will be quite a high target to achieve. Because the ground reality is that Pakistan’s exports which were just $20.5 billion in 10 months, July-April of FY-13, sadly declined to $18.2 billion in the like period of FY-16. Going by these facts, achieving a $35 billion export target in FY-17 will be quite a task.
Imports were $33 billion in July-April FY13 compared to $32.7 billion in the like period of FY-16. Savings in the import bill of oil were nearly 40 per cent. These savings were diverted to larger imports of machinery and industrial raw materials. The import of machinery in the last three years has increased by a cumulative 40 per cent - which is an indication of growing interest of foreign and domestic investors in Pakistan. The government realises the fact that Pakistan’s export potential has not been fully achieved due to “depressed international commodity prices and a continuing slowdown in major export market.”—Agencies