President Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Mian Anjum Nisar and Vice President FPCCI Sheikh Sultan Rehman have urged government to develop a robust and holistic industrial policy that could lead to a massive industrialization in the country.
The trade leaders said that Pakistan may not be able to reap the benefits under Phase II of China-Pakistan Free Trade Agreement (CPFTA-II) despite elimination of duties on 313 tariff lines, covering most of Pakistan's exports.
They pointed out that during Phase I of China-Pakistan FTA, the balance of trade remained greatly in favour of China which managed to export 57 percent of its product lines while Pakistan could take advantage of only 5 percent of its product lines. Pakistan exported $ 2.1 billion approx, while imports from China have reached more than $ 17 billion that created a trade gap of $ 15 billion approx in favour of China.
They expressed serious concern over Pakistan's ability to benefit from Phase II, when Pakistan does not have surplus products to export due to a shrinking economy.
They further highlighted the fact that industrial output is declining because of de-industrialization in the last few years.
Serious issues like, high interest rates, frequent increases in power and gas tariff, unavailability of gas supply to industries, abrupt changes in government policies, rampant smuggling, refunds to exporters and an overall hostile environment are making it difficult for industries to sustain their existence.
They urged Chinese companies to enter into joint ventures with Pakistani manufacturers and relocate their industries to Special Economic Zones.
These efforts will significantly raise industrial output enabling Pakistan to take advantage from Phase II of China-Pakistan FTA. Otherwise, Pakistan will not be able to receive benefits from supposedly vast opportunities available to us and the fate of second phase of China-Pakistan FTA will not be any different that the first phase.
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