LAHORE: The Pakistan Industrial and Traders Associations Front (PIAF) former chairman Irfan Iqbal Sheikh has asked the government to take measures to further squeeze country’s trade deficit which slightly fell to $8.86 billion in first quarter of current fiscal from the $9.01 billion reported in corresponding period of last fiscal. The overall trade deficit contracted by 1.61 percent in July-September 2018 period of Fiscal Year 2018-19 (FY19) as compared to the same period of FY18.
Irfan Iqbal Sheikh said that the Pakistani rupee continued its downward slide against the US dollar, hitting the all-time low of Rs134 against the green back in the inter-bank market. It indicates that the country is once again marching towards another huge trade deficit, which would further jack up the current account deficit.
Chairman PIAF Mian Nauman Kabir also urged the government to come up with better trade policy for trade and industry to bring down the gap of trade deficit. Trade policy 2018-23 which is expected to be released in the current month, to achieve its target its very much necessary to curtail the energy prices for industry so that cost of doing business may be reduced leading to increasing the exports. It is necessary to have SWOT analysis of previous issued policies and keeping in mind the weaknesses, flaws and negative effects, new trade policy 2018-23 be issued, Mian Nauman Kabir added.
The overall exports in first three months of FY19 increased by 4.56 percent to $5.39 billion as compared to $ 5.15 billion worth of goods exported in corresponding period of previous fiscal year. Imports in first three months of FY19 went marginally up by 0.63 percent to $ 14.2 billion as against $ 14.17 billion in the same period of FY18.
On monthly basis, exports from Pakistan to other countries dropped significantly by 14.35 percent in September 2018 to $1.72 billion as compared to $2.01 billion in August 2018. Similarly, imports in the country witnessed sharp decline in September 2018 to $4.43 billion, plummeting by 11.25 percent as compared to $4.99 billion in the month of August 2018. Trade deficit narrowed by 9.16 percent to $2.70 billion in September 2018 as compared to $ 2.97 billion in August 2018.
PIAF former Chairman said the government set unrealistic exports target amid improving export competitiveness, increasing share in regional trade, transition from factor driven economy to efficiency-driven and innovation driven economy.
He said that five percent of the export revenue gets stuck up in present refund regime of which resultantly massive working capital has been stuck up which is the major cause of export decline. He said the Finance Act 2015-16 and textile policies 2009-14 & 2009-19 still remains redundant as the textile industry is deprived of the incentives announced in the act.
Published in Daily Times, November 13th 2018.
