ISLAMABAD

The government is considering to fix ambitious exports target of $40 billion in the Strategic Trade Policy Framework (STPF) 2015-18, which is likely to be announced in next month (August), it has learnt.

The draft of Strategic Trade Policy Framework (STPF) 2015-18 is in the final stages of its completion and will be presented to sub-committee of the Cabinet very soon for further deliberations. After incorporating the recommendations of the sub-committee the draft will be submitted before the Cabinet for final approval.

“The commerce ministry will propose to increase the exports to $40 billion by the end of fiscal year 2017-18”, an official of the ministry said. The government has proposed to enhance the exports to $30 billion during ongoing financial year 2015-16, $35 billion in next fiscal year 2016-17 and $40 billion by the end of year 2017-18. The overall volume of the exports in STPF 2015-18 is estimated at $105 billion.

It is worth mentioning here that Commerce Ministry’s estimates regarding exports are much below than the desired target of Prime Minister who wants to double the exports to $50 billion by the year 2017-18 from existing $24 billion. Prime Minister had directed the commerce Minister Khurram Dastgir Khan to double the exports. The Commerce Ministry’s officials believed that doubling the exports from current level is a difficult task keeping in view the severe power shortage in the country. Therefore, the commerce ministry would recommend fixing exports target at $40 billion in STPF 2015-18 what it termed a ‘realistic target’. However, federal cabinet would take a final decision regarding fixing exports target in STPF 2015-18.

Sources further said that main focus of the upcoming trade policy will be engineering sector, rice, leather and surgical instruments and projects related to these sectors will be made part of the policy. Efforts will be made to include more items under standards and certifications. The government will take steps to reduce locally assembled cars by tightening prevalent passport-based used cars import policy. The new policy contains attractive incentive packages for the exporters who would employ new techniques and machinery to their production methods.

It is worth mentioning here that government failed to achieve the targets set in the previous Strategic Trade Policy Framework 2012-15. The government failed to achieve the exports target of $95 billion in three years, as it remained under $70 billion mainly due to the poor law and order and energy situation in the country. In the budget estimates for 2014-15, the federal government had earmarked Rs 2 billion towards STPF. Not a penny was spent under this head, according to the budgetary documents.

The key announcement of STPF 2012-15, I,e, establishment of Pakistani Exim Bank aimed at facilitating exporters is still a dream though the Finance Minister committed to establishing the bank in 2015-16 in his budget speech. Likewise, Land Port Authority is yet to be formalised.

The government had missed the exports target of $27 billion and revised target of $24.2 billion during last financial year 2014-15. Pakistan’s exports had gone down by 4.88 percent to $ 23.885 billion in previous fiscal year from $25.11 billion of the preceding year. However, imports had enhanced by two percent to $45.98 billion in FY2015 from $45.07 billion of the FY2014. Therefore, the trade deficit was registered at $22.095 billion during the period under review.