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Pakistan unveils new measures to boost exports

ISLAMABAD - Pakistan has announced fresh measures in new trade policy to improve competitiveness and quality of products aimed at increasing the share of the products of small and medium enterprises in total exports.

On the basis of these new measures, the commerce ministry has projected a 15 per cent growth in export proceeds for the year 2008-09 mostly to be generated from traditional and conventional products in a bid to diversify the exports base.

Through the trade policy, it was announced that health ministry will draw up a proposal for establishing bio-availability and bio-equivalence laboratories in the National Institute of Health.

Export of free samples up to five per cent of quantity is allowed against exports in the preceding year to pharmaceutical exporters. It has also now been decided to allow exporting companies to send free samples to the extent of 10 per cent of the commercial quantity exported in the preceding year. In addition this sector would also be allowed to retain 15 per cent of their export proceeds.

A committee comprising Ministries of Commerce, Health, Finance and Federal Bureau of Revenue (FBR) will work out a detailed proposal for grating pioneer industry status to biotech drugs, which is a high tech value added sub sector of pharmaceuticals.

It has been decided that TDAP would open an office in the Northern Areas. Furthermore Minfal will also arrange for SPS controls at Pak-China border for certification of cherry and other fruit products exports since they are in great demand in the Chinese market.

To facilitate exports to the Afghanistan provinces of Paktia (Gardez) and Khost, it has been decided that a Customs station at Pak-Afghan border would be setup at an appropriate location. This will reduce transportation cost and delivery time to this area from Pakistan.

It has, therefore been decided to establish a Halal Certification Board, under the Ministry of Science and Technology, to devise and enforce Halal Standards and certification mechanism for export of Halal food products. Currently, exporters setting up slaughter houses are facilitated by the Export Development Fund (EDF) picking up the first six per cent of the mark up on investment financing. It has now been decided to enhance this facility and the EDF will therefore pick up the first eight per cent or 50 per cent of the mark up which ever is lesser.

It has now been decided to increase the limit to $50,000 from $25,000 worth of samples to foreign buyers in the case of automobiles. A study will be conducted jointly by the FBR and the Ministry of Commerce to quantify the extent of refund of indirect taxes on input cost incurred on manufacturing of merchandise, which will become due on this account.

To promote export of herbal medicine, 50 per cent of the cost of registration of herbal medicinal products abroad shall be picked up by the government as is done in the case of export of pharmaceutical products.

It has been decided that consultancy services will be arranged through FAO / INFOFISH for agriculture; Peeling shed at Karachi Fish Harbor will be set up in coordination with TDAP and Sindh government. Funding will be arranged through the Public Sector Development Programme, training programme for fishermen in catching of fish will be arranged by the Sindh government. Initial programme of training for trainers will be arranged in collaboration with TDAP. These measure will help in improving seafood exports.

The initiative of hiring of consultants for benchmarking studies of leather garments exporting units will also be continued on a cost sharing basis, ministry of industries would set up a wood seasoning plant and NAVTEC will set up a couple of vocational training centres on modern lines to meet deficiencies of wood seasoning plant and skilled labour.

To promote floricultural exports it has been decided that a Flora Common Facility Centre would be set up in collaboration with Punjab Government near Lahore; depending on its success the project will be replicated in other provinces. An irradiation facility based on the latest E-Beam technology would also be set up in Karachi in collaboration with Sindh government to facilitate export of horticultural products.

It has also been decided that the existing facility of picking up the first six per cent markup rate on loans obtained for cool chain and cold storages for horticulture will be revised to eight per cent or 50 per cent of the prevailing mark up rate which ever is lower. The umbrella National Trade Corridor Programme is also making provision for development of a cool chain infrastructure.

Area under rice cultivation is under pressure from other crops and the yield is decreasing as no high yielding basmati variety after "Super Basmati" has been introduced. The cumulative effect of these two factors could erode the exportable surplus. It is therefore proposed that:- The ministry of Food and Agriculture (Minfal) may focus on evolving new varieties and increasing area under rice cultivation. Paddy harvesters and paddy dryers may be provided on matching grant basis in rice growing areas; Minfal will explore the possibility of using Agribusiness Support Fund for this purpose.

Initially for demonstration purposes four dryers and harvesters will be provided from the EDF to Minfal. Furthermore rice farm machinery namely paddy harvesters and dryers will be importable from India through Wahga by road. Unhindered import of rice seeds increase disease risks therefore all such imports shall undergo strict quarantine measures. For this purpose the "Seed Act" and other related laws will be amended accordingly.

In order to develop handicraft sector and make it a viable industry it has been decided that consultants of international repute would be engaged to suggest improvements in the development of handicrafts with a view to achieving a quantum jump in their export.

Arrangements will be made to expose master craftsmen to international designs and trends. The 11 new industrial clusters will be established across the country.

It has been decided that a system of voluntary pre-shipment inspection and sampling of agro-products for exports will be introduced. In this regard lists of concerned products, corresponding standards and accredited labs shall be notified by commerce ministry after consultation with Minfal and ministry of science.

It has been decided that a Trade Dispute Settlement Organisation, under the administrative control of Ministry of Commerce, will be set up to deal with trade disputes arising from exports.

The TDAP Act will be amended to revisit the working and structure of the organisation so as to make it more responsive to the exporter's needs. It has now been decided to expand the outreach of the National Productivity Organisation (NPO) by funding "Training of Trainers" for auditors from EDF in production, energy and labour productivity audits.