ISLAMABAD: The Commerce Ministry and exporters on Thursday joined the chorus against Finance Ministry and Federal Board of Revenue (FBR) for an ‘unjust’ federal budget tailored in consultation with the International Money Fund (IMF), as it will hit exports. This was the crux of a meeting of Senate Standing Committee on Commerce, presided over by Senator Anusha Rahman and attended by Senator Sarmad Ali, Amir Waliuddin Chishti and Senator Tallal Badar.
Chief Executive, Trade Development Authority of Pakistan (TDAP), Zubair Motiwala, gave a detailed presentation on the activities of his organization, trade facilitation and product development- supply side intervention.
He also shared TDAP’s future plans for further penetration in the international market to enhance Pakistan’s share. He, however, was unhappy with some exporters, who according to him are sending rotten mangoes to Dubai, which is earning a bad name for the country. He said, UAE has agreed to organize a single country exhibition for Pakistan.
The issue of export of IT services also came under discussion at length. Chairperson Standing Committee argued that this sector should have been given more incentives to grow.
During discussion on growth of exports, Syed Hamid Ali, Additional Secretary Commerce, said that the government should not treat Commerce Ministry like other Ministries, as it is a specific Ministry and earns dollars for the country.
He maintained that Commerce Ministry’s recommendations for federal budget 2024-25 have not been accepted, adding the issues of Commerce Ministry’s attached entities are also not being given any weightage by the Finance Ministry. Motiwala informed the committee that a recent SRO 350 issued by the FBR has severely hit the industry including export industry as a huge amount capital will stuck in the process.
FBR to issue uniform tax recovery rules in budget
“I have talked to FBR Chairman Malik Amjed Zubair Tiwana who promised that he would talk with Managing Director SSGC to sort out this issue. I responded that the issue may be sorted out this month but what will happen next month,” he added.
Anusha Rahman, who claimed she was not interested in Commerce Committee, but was given the task as serious efforts are needed to enhance country’s exports.
Chief Executive TDAP, Zubair Motiwala prior to leaving the committee Room for a meeting with President Asif Ali Zardari, told Senator Tallal Chaudhry that he has conveyed to the highest level that with current taxation measures announced in the budget exports will come down.
Chairperson Standing Committee argued that India and China have captured international market and now they are dumping products, and queried as to what TDAP is doing to deal with this situation and is TDAP finding new markets.
Responding to her, CE TDAP said “we are trying our best to improve quality of products to get the maximum price but the problem is that our people send inferior quality products due to which issues are rising; we are trying to increase quantity and to export our surplus especially in agriculture produce.”
Motiwala maintained that some arrangements should be made to stop export of low quality products which will help improve prices of Pakistani products. He said, TDAP is receiving complaints against Pakistan exporters.
The issues of SMEs and their contracts with international buyers also came under discussion.
Javed Bilwani, a representative of Exporters Associations briefed the committee on the woes of exporters, saying that exporters are stuck in a vortex and have been all but destroyed in the recent budget due to multiple taxes.
He said, the authorities who made the budget did not consult TDAP on the cost of doing business in Pakistan versus regional countries.
He proposed that Trade and Investment Officers (TIOs) should only be from Commerce Ministry who should deliver to the Commerce Ministry.
He said, three or four export sectors like meat exporters and horticulture exporters do not have documentation, so how will they export under the new tax regime.
“Three or four sectors claim that they are eliminated due to recent budget measures,” he added.
Bilwani said that most of the sectors are under the fixed tax regime but only exporters have been selected not to be in this regime, adding that the condition of exporters is now worse than those who are in normal tax regime.
He proposed the government formulate Trade Policy for five years and fix all taxes and utilities in dollar terms for this period and inform us of the number of public holidays so that exporters should know where they stand.
“When exporters do not trust the government, then how will he do business,” he questioned.
Director General, Intellectual Property Organization (IPO) gave a presentation on the performance of her Organisation and pendency in cases. She noted that the Organisation is under staffed as its total strength is 319 whereas currently staff strength is 139 less than the approved strength. The committee gave two months’ time to fill vacant posts to streamline working of the Organisation. Absence of Chairman IPO from the meeting also came under discussion.
The Committee also directed IPO to hire IT firm through competitive bidding process to expedite applications registrations process instead of giving contract on the basis of an MoU.
Copyright Business Recorder, 2024
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