ISLAMABAD - The government is contemplating some measures to control soaring imports in the revised Strategic Trade Policy Framework (STPF), which is likely to be announced in coming weeks.

Pakistan’s imports are continuously increasing from last one year or so, as it reached to alarming $57.85 billion in 13 months. The country’s trade deficit has also touched historic level of $32.58 billion during previous fiscal year 2016-17 due to the massive increase in imports and decline in exports. “The Ministry of Commerce may propose some measures to discourage imports in the mid review of the STPF,” said an official of the ministry.

He said that the government would decide to further enhance duties on imported goods or not. He said that the ministry would also propose measures to boost tumbling exports after consulting with the stakeholders. The ministry had admitted that the government could not achieve the exports target of $35 billion by June 2018. The ministry had decided to make changes in the trade policy framework. The ministry in consultation with Commerce Minister Pervaiz Malik would present the mid-term review of the Strategic Trade Policy Framework (STPF) 2015-18 to Prime Minister Shahid Khaqan Abbasi.

It is one of the main challenges for the newly appointed minister to control the soaring trade deficit of the country. The current account deficit had widened by 148.5 percent to an all-time high of $12.09 billion for 2016-17 due to the massive increase in trade deficit. The government and State Bank of Pakistan (SBP) had already taken measures in last few months to reduce the imports. However, the imports are still increasing.

Earlier, in February 2017, the SBP had already imposed 100 percent cash margin on the import of consumer items to bridge an alarmingly high trade deficit. The requirement of 100 percent cash margin has been prescribed on items such as motor vehicles - both completely knocked down and completely built units - mobile phones, cigarettes, jewellery, cosmetics, personal care, electrical and home appliances, arms and ammunitions etc.

Meanwhile, the federal government in the budget for the ongoing financial year 2017-18 had enhanced Regulatory Duties (RD) on more than 500 items including electronics, milk products, kitchen items, cars, fruits and vegetables. The impact of the RD on the import of luxury and non-essential items stood at Rs10 billion. The government had taken the decision to control the imports. However, these measures had not controlled the imports. The soaring imports are putting pressure on the country’s foreign exchange reserves. The country’s reserves have come down to $20 billion from historic $24 billion of almost a year back.