Seeking advice on trade policy

For the first time the Ministry of Commerce has secured the assistance of the United Nations Development Programme (UNDP) in the preparation of the Trade Policy.
Accordingly the services of two UNDP experts have been made available to the ministry, and they have chalked out a programme for meeting the representatives of the various trade bodies in Karachi through the good offices of the Export Promotion Bureau.
These meetings will enable the two experts, Keith Stuart Smith and John T. Thoburn, to gain first-hand information on the problems faced by each export industry. The exporters' groups have by and large welcomed the advisory services offered by the UNDP in the hope that the exercise would find out viable solutions to various difficulties.
The UNDP's assistance would appear to be specially important in the context of implementation of the WTO agreement with effect from 2005 in respect of liberalisation of international trade.
Pakistan will be more concerned over the sudden change in the textile trade through the replacement of the existing restrictive trade practices in the shape of export quotas.
The quota administration by the Export Promotion Bureau over the last several years, is expected to be wound up by the end of the current calendar year. The entire fabric of quota exports involving a large number of categories of textile items would cease to exist. As a result, the textile exporters will be confronted with a complete turnabout.
They will be beset overnight with the task of finding markets for their goods as they would no more be enjoying a secured market share in the countries regulating their imports through the quota system.
Thus the major textile markets for Pakistani exports, namely USA and European Union, will have to be re-explored by our exporters in a completely free trade scenario.
This prospect would undoubtedly warrant a closer study of the new challenges and, accordingly, suitable changes would have to be made in the forthcoming Trade Policy.
The contribution of the UNDP experts in this respect is expected to be quite useful. At the same time, a number of other policy issues would have to be reconsidered by the government in order to make the Trade Policy conform as closely as possible to the WTO regime.
Correct advice on such issues may be expected from the UNDP experts. Moreover, the principles of free trade as enunciated in the WTO agreement would also have to be adhered to in the Trade Policy. In this context, Pakistan's reservations about granting 'most favoured nation treatment' to India in response to an initiative from the latter, would have to be borne in mind in framing the policy. In the absence of a convincing rationale, Pakistan may face objections from the WTO and other trade partners.
It may be pointed out here that the last SAARC summit has already endorsed the principle of free trade in the region without any exception. Towards this end, a separate agreement under the name of "SAFTA" for the promotion of free trade area was also signed.
In these circumstances, the new Trade Policy would be expected at least to assure most favoured nation treatment to India without compromising national interest.