Encouraging export performance

Although Commerce Minister Humayun Akhtar Khan thinks it mattered little if a number of initiatives envisaged in the Trade Policy - 15 out of 24 - were yet to be put through, the slow pace of efforts by the government on this front, is undeniable.
However, since most of the initiatives required long term policy planning for putting in place the necessary prerequisites and related facilities, it may be noted with satisfaction that notwithstanding the non-accomplishment of several initiatives, the export growth in the first eight months of the current fiscal year proved to be fairly encouraging at 14 percent with receipts amounting to 7.878 billion dollars.
In the light of this performance, the minister was confident that the export target of 12.1 billion dollars would be achieved successfully and may even be surpassed.
The lead to export growth was provided by the country's major exportables, viz. textiles and garments accounting for 5.278 billion dollars, reflecting 15 percent rise over the comparable period of last year.
The dynamic performance of textiles would be seen as a reassuring aspect in view of the fact that the expiry of quota system from 2005 is likely to pose a serious problem to our textiles in maintaining the present share in the world export market.
The textile industry's assiduous efforts to carry out a fairly large scale innovation and modernisation programme to manufacture higher value-added goods, appears to have produced satisfactory results, as noticed in the encouraging growth of exports during the current year.
Of the equally important exportable items, namely, rice, leather, sports goods, carpets, surgical goods, petroleum products etc, the export of rice increased by 17 percent which was a happy development. However, sports goods and surgical instruments registered declines by 4 percent and 13 percent respectively.
The need to investigate the reversals in the export of these items can hardly be overlooked. Similarly, the leather group showed a low rate of growth of 2 percent which appeared to be a disturbing feature because leather and leather goods exports occupy a prominent place in Pakistan's foreign trade.
A setback in this item should be taken seriously and all adverse factors affecting export growth should be looked into by the Export Promotion Bureau and other authorities in the Commerce Ministry.
In the group described as development products, the sharp increase in the export of engineering goods may be described as a highly significant development.
It appears that the consistent efforts to push forward exports of higher value-added engineering goods have at long last produced the desired results, and it is expected that these goods would continue to show a rising trend in the coming years.
Encouraging trend in exports was also noticed in fish and fish products which were up by 21 percent, while exports of vegetables and fruits increased by 14 percent.
These gains, by and large, proved to be instrumental in offsetting low level of wheat exports which amounted to 97 million dollars.
It may be pointed out that in spite of the virtual absence of wheat and poor export growth in leather and leather products combined with the declining trend in the export of sports and surgical goods, the cumulative export earnings for the first eight months registered a significant growth of 14 percent.
This shows that the country's export potential stands significantly diversified in terms of exportable items with the result that the overall tempo of export growth was well maintained in the current year, despite declines in the export of quite a number of traditional items.
The overall encouraging export performance could be described as a very positive showing of the economy even though the exporters/export industries continue to face an uphill task in putting up with the hurdles like long delays in the sales tax refunds besides other difficulties, including rise in cost of production due mainly to the high cost of energy.
The various policy pursuits initiated in the Trade Policy included an enterprise capacity building scheme, up-gradation of skills and enhancement of quality of leather products, promotion of joint ventures in export development, expansion of industrial clusters for export, developing contamination-free cotton for export, re-location of industries, re-organisation of the Export Promotion Bureau etc.
In these spheres implementation is stated to be in progress. The completion of the above initiatives and other measures, including image building for Pakistan's exports through foreign consultants and public relation organisations, it may be hoped, would contribute significantly to the country's export growth.