Commerce Minister Humayun Akhtar Khan on Thursday rejected business community's demand of liberalising trade with India, saying that Pakistan has linked the issue to progress in resolution of political disputes, including Kashmir.
"Many of the business community members are asking for opening up of trade with India, but the Government of Pakistan will take such a decision with the progress in resolution of political disputes. Pakistan will take such move when the time comes," he said while addressing the 57th meeting of Advisory Council of commerce ministry convened to consult trade bodies for preparation of Trade Policy.
Most of the trade bodies and farmer associations have already dispatched their suggestions, but they were invited to present their suggestions at the open forum.
Humayun said that both Pakistan and India are engaged in Joint Study Group-level for removing the bottlenecks for the trade and at composite dialogue level on economic co-operation.
"Bilateral trade is continuing under importable items list and if someone wants to include any item in the positive list, he can approach ministry of commerce," the minister added. He was of the view that the real issue was the cost of doing business for which the government was taking various measures.
State Bank of Pakistan governor Dr Shamshad Akhtar in her remarks said that the banking system has suffered heavily due to bad loans, taken by the business community and defended the export re-finance policy, saying the scheme was misused.
She said the central bank has already directed the commercial banks to charge 9 percent interest on export re-finance loans which were at par with auction of six monthly T-bills.
The SBP governor was of the view that Pakistan's export re-finance rates were lower than that in India, but admitted that the banks were not fulfilling investment requirements in housing sector due to land disputes.
Dr Shamshad further said that the public sector banks were considering to write-off loans given in earthquake-hit areas on case-to-case basis, but private sector banks were independent in taking decisions.
Central Board of Revenue (CBR) chairman Abdullah Yusuf said that the government would do its best in the budget to facilitate the business community but they should also come forward to assist in expanding the tax net. By way of irony, he said, every one wants a tax-free regime and interest-free loan.
The CBR chief was of the view that Pakistan's tax-to-GDP ratio was lowest in the region and business community should help the government in enhancing it.
Hamid Malhi, representative of Punjab farmers, criticised the government for importing food items from India, saying it is affecting the farmers' financial health. Instead, he added, the government should allow the farmers to import agriculture machinery from India, which will contribute in enhancing the production.
He also demanded that GST should be abolished on all agriculture inputs, ensuring maximum transfer of earning to the food producers for a long-term production of quality goods.
Malhi lashed out at the government for inconsistent policies with regard to export of food items and referred to wheat for which sometimes government allows the export and sometime bans it.
"We need reduction in power tariff which is only possible if the hydel electricity production is increased in the country, he continued. The representative of Muzaffarabad Chamber of Commerce said that construction industry is facing many challenges because of hike in cement price, and high steel prices.
He requested the government to write off loans, which the traders had taken for their businesses prior to the earthquake as owing to the tragedy they are in need of small loans for continuing their business activities.
Sahbbir Bhai, representing the bed-linen association, praised the government for playing pivotal role in getting reduced the anti-dumping duty imposed by European Union. However, he said that mark up rates on loans are very high owing to which the cost of production is being affected.
Shahid Ahmad, representative of Pak-America Business Council, came up with the demand that trade policy should be for 3 to 4 years and not for one year only.
He said that the government should allow the industrialists to import machinery required for power generation at zero-rated duty.
The Commerce Minister announced that government is planning to set up Agriculture Processing Zone in Sargodha when the representatives from that area came up with various suggestions to increase the export of citrus fruits.
The representatives of the knitwear association said that garment industry is almost at the verge of collapse and needed special attention of the government.
The representative of the electronics association said that Pakistan has witnessed a tremendous growth in the locally-made TVs, but now that growth has come to a standstill because of the import of used monitors.
Earlier, Federation of Pakistan Chambers of Commerce and Industry President Chaudhry Mohammad Saeed figured out the problems being faced by the business community and presented demands for incorporation in the next trade policy.
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