MUSHTAQ GHUMMAN

ISLAMABAD: A high-level panel headed by Finance Minister Senator Ishaq Dar has reportedly barred Commerce Ministry from offering concessions to any country in Free Trade Agreement (FTA) beyond Pak-China Free Trade Agreement (CPFTA), sources close to Minister for Industries and Production (MoI&P) told Business Recorder.

The panel comprised Minister for Commerce, Engineer Khurram Dastgir Khan, Minister for Planning, Development and Reforms, Ahsan Iqbal, Minister for Industries and Production, Ghulam Murtaza Khan Jatoi, Governor, State Bank of Pakistan, Secretaries of Finance, Commerce, Petroleum, Water and Power, National Food Security and Research, Textile Industry and Chairman FBR. The panel gave these instructions to the Commerce Ministry at a time when negotiations on FTAs are underway with Turkey and Thailand. A consultation process is also in its final stage for second phase of FTA with China. Commerce Minister is disappointed with the performance of his own team and is reportedly searching for competent officers to formulate international deals. A couple of consultants sitting in the Ministry are also considered a burden on the national exchequer.

Giving the details, sources said, Secretary Commerce, Shahzad Arbab presented salient features of the draft Strategic Trade Policy Framework (STPF) 2015-18 and highlighted policy initiatives, efforts at regional connectivity and trade diplomacy. The policy builds on the progress achieved during the previous two policies covering the period 2009-15. It covers all key areas of support needed to create exportable surplus and pillars that would enable producers to achieve high export targets. It was noted that during the period of last policy 2012-15 cumulative exports increased from $ 54 billion to $ 74 billion against the target of $ 95 billion. The meeting noted an increase in volumes but a decrease in value due to global pricing trends. The STPF proposed an export target of $ 35 billion by year 2017-18 with annual growth of 14 per cent. This would be achieved through implementation of various initiatives under the proposed STPF.

The sources said, the Finance Minister observed that mark-up rate subsidy is not required due to historic lower policy rates. He directed the Governor State Bank of Pakistan to design the privatisation proposals for the SME Bank and Industrial Development of Pakistan (IDBP) in such a way that the private operator keeps the business focus of these banks intact while diversifying into different products.

The meeting noted the initiative of Research and Development (R&D) and brand development support and expressed the hope that these could help groom short and medium enterprises into competitive outfits that could chip in for export enhancement. It was decided that the sector specific support organisations will be strengthened and new support initiatives esigned with an understanding of the lessons learnt from these organisations. It was observed that there is a need to rethink the initiative of skill development centres in view of past experience. Financial impact of various support measurers would be kept in view. The meeting noted that Pakistan’s exports to China increased by 400 per cent after Free Trade Agreement (FTA) while increase in Chinese exports was 250 per cent. It was observed that there was a need to review various aspects of the agreement in the light of trade development and effects on industry. It was noted that the future agreements will not offer concessions beyond the threshold of the Pak-China FTA (PCFTA).