PAKISTAN UNVEILS NEW TRADE POLICY TO BOOST EXPORTS
Pakistani government allowed freer
cotton and rice export in a three-year new trade policy aimed
at narrowing the country's yawning trade gap.
    Commerce and Planning Minister Mahbubul Haq said in a
televised speech the government had also decided to allow
duty-free import of cotton yarn to make the textile industry
more competitive, and to link bulk tea imports to the export of
Pakistani products.
   
    Cotton and rice are Pakistan's main exports, which have
been handled exclusively by state corporations since early
1970s.
    But Haq said now the private sector would also export
cotton and rice along with the corporations, which meets a
long-standing demand of the local traders.
    The duty-free import of cotton yarn has been allowed to
bring down prices and help the local ancillary industries
compete effectively in the world market, he said.
   
    Haq said the new policy, effective from the fiscal year
1987/88 beginning on July 1, would be for three years but
reviewed every year.
    It was a departure from the previous practice of announcing
trade policies for a single fiscal year, and Haq said it would
enable the businessmen to plan their market strategies over a
longer period.
    He said an export credit of 250 mln dlrs had been provided
for the export of engineering goods to selected third world
countries on soft credit terms.
   
    Pakistan's 1986/87 exports at 3.6 billion dlrs, 18.2 per
cent more than in the previous year, and imports at 5.23
billion dlrs compared to 5.63 billion dlrs in 1985/86.
    He said the government policy was to rationalise and
streamline import controls.
    "It has been observed that due to restrictions on imports,
specially on raw materials and intermediate goods, local
industry has been suffering for want of necessary inputs," he
said. "Prices have been on the increase and quality of goods
produced has been low. This restrictive policy also gave rise
to smuggling and hampering of exports."
   
    He said that to correct this situation, 136 items had freed
from import restrictions.
    Previously, Pakistan has met its trade gap largely from
remittances from its nationals working abroad, mainly in the
Gulf. However, the remittances have begun to fall after the
drop in oil prices in recent years leading to the spectre of a
balance of payments crisis for Pakistan.
 Reuter
