Pakistan rejects proposal to devalue rupee in near future

ISLAMABAD — Pakistan government has rejected a proposal to devalue Pak rupee with a view to compete in the international export market. It is generally acknowledged that the products from China, India and Sri Lanka were giving tough time to Pakistani exports.

By A Correspondent

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Published: Fri 27 Jul 2007, 9:55 AM

Last updated: Sat 4 Apr 2015, 10:23 PM

Informed sources said that the government did not believe that Pakistani currency is "over-valued" and needed to be brought down to compete with others players in the global export market.

Exports

The government has made it clear to all the concerned that it would not devalue Pakistani currency at least in the near future. It is said that the ministries of finance and commerce were jointly formulating a new strategy to enhance the country's exports.

"Devaluation is not the solution and the solution lies in creating competitiveness for which a new strategy is being finalised by the ministries of finance and commerce", a senior official of the ministry of finance said.

When approached he said Chinese and Indian currencies were appreciating due to which Pakistani currency had stabilised and it was decided "not" to devalue Pak Rupee as was being proposed by some quarters. "This is good opportunity to have a big jump in our exports during the next financial year", he said admitting that without improving the quality of Pakistani products, exports will not pick up.

Competitive

Giving the details about the new strategy, he said that while Pakistani products will be made competitive particularly through value addition, new export markets will be explored in the world. The job will be done by ensuring improved performance by Pakistani missions abroad and by sending trade delegations to important countries. "We are reviewing the whole issue of falling exports".

Sources said that the government has decided to establish Metal Products Production Line to help produce the-state-of-the art metal products by the local engineering industry aimed at increasing their exports.

The metal products used in automobile, textile machinery, tractors, trucks, cookware, sanitary fittings, valves and other similar products will be manufactured as per "international standards" under the new project to be set up at Daska, Punjab. The federal government will provide special Rs500 funding for the project.

The local engineering industry, have failed to achieve the targets set for deletion of imports parts. The reason for this state, sources said, could be attributed to the inability of the metal industry to manufacture good quality products due to the use of out-dated techniques. This can be greatly improved through state-of-the art techniques/equipment pertaining to the quality oriental metal productions production unit. The metal products production line has been proposed by utilising and sharing trained manpower, product design, development and other infrastructure facilities to be set up for both import substitution and export promotion by introducing high quality metal products in the international market.

Production

The production line will also help the local industry to assimilate new technologies. It was said that the local manufacturing industries lack modern production (forging & precision casting) facilities due to not making intensive initial investment in this area of engineering sector. There will be quality assistance for the non-destructive testing according to international requirements. It will also help increase employment generation and poverty alleviation. As Pakistan is in the process of enhancing its exports, it is apparent that the country should go into engineering sector and metal industry to enhance its exports through the production of value added high quality metal products with a view to explore new international markets for exports. The establishment of multipurpose manufacturing facilities can play vital role in the export promotion of metal products. Development of these facilities for the manufacturing of Ferrous and Non Ferrous(wrought and cast) components would be utilised by the local industries/markets and lot of foreign exchange would be saved. Specifically supreme quality general purpose and engineering products made by forging, precision casting processes would be produced through modern manufacturing facilities and it would continue to import substitution and would enhance the capability for export promotion.

SME sector

"Most of our local small and medium industries (SME) are not equipped with modern manufacturing techniques and equipment", says a document submitted to the Planning Commission by the ministry of science and technology which is the sponsoring agency for the project. Establishment of this project for the production of metal products would be very useful for both imports and export purposes.

The establishment of metal products production line would also act as a modal project for other local and foreign investors to execute such activities in this sector. Manufacturing industry is the back bone of any development country. However, the selection of engineering materials and manufacturing processes specially for auto industries, sanitary fitting, gas pipeline fitting, valves, textile parts and their value added metal products must conform to standard specification with highest degree of quality.

Without possessing the multiple manufacturing processes/techniques, commercial manufacturing cannot take part in the national endeavour for the attainment of self reliance in the field of quality metal products for import substitution and export of various metal products. " Moreover, the establishment of metal products production line would be an effort to support the agricultural based economy of our country to engineering sector to achieve a quantum jump in the country's export of metal products to international market", the planning commission was told.



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