Government strictly focused on enhancing exports

ISLAMABAD: The present government is strictly focused on enhancing exports and in this direction, taken various initiatives with respect to adjustment of exchange rates and monetary tightening.

Imports during Jul-Apr FY2019 declined by 4.9 percent while worker’s remittances increased by 8.45 percent, according to Pakistan Economic Survey 2018-19,launched here on Monday by Adviser to Prime Minister, Dr Abdul Hafeez Shaikh.

This proved to be a major support to the current account balance which improved by 26.9 percent during the period, it added.

However, exports remained a source of concern as they declined during Jul-Apr FY2019.

According to the survey, there is a continuous increase in the flows of credit to private sector in manufacturing and export oriented industry which is a welcome development in terms of business activities.

However, the downside risk of the impact of continuous rise in policy rate and global slowdown in trade activities may influence the exports.

Financial account posted a surplus of US$ 11.32 billion during Jul-Apr FY2019.

The improvement is mainly due to the bilateral inflows from China, India and UAE. However, foreign investment remained low during the period after a consistent increase over the last three years under China Pakistan Economic Corridor (CPEC).

This is because of the completion of early harvest projects under CPEC.

According to the Survey, there is a need to implement a range of structural reforms including growth enhancing fiscal consolidation, reducing cost of doing business, attracting foreign private investments, exploiting the potential of Pakistani diaspora,  introduction of effective and responsive foreign exchange regime, and most importantly, focus on enhancing exports through improving productivity at different stages of production.

Moreover, integrating the domestic production with global value change, research and development, technology up-gradation, value addition and branding will help in increasing the exports.

The establishment of Special Economic Zone (SEZs) and free trade zone at Gawadar will enhance export growth and access to regional markets going forward.

The trade diplomacy also needs to be strengthened.

According to the Survey, during FY2018 Pakistan’s exports picked up and reached to US$ 24.7 billion showing a growth of 12.57 percent over previous year FY 2017.

Imports on the other hand also increased by 16.25 percent and touched the highest figure of US$ 56.6 billion.

However, the present government took this challenging issue and focused on anchoring the increasing import bill by restricting unnecessary imports which started eroding the competitive edge of domestic industry including the exports units.

A number of measures have been taken in this regard which helped in reducing the import bill and simultaneously formed a stimulus for sustainable economic growth by improving competitiveness and efficiency of the industry especially export oriented and import substituting units and reducing anomalies and cost of doing business, it added.