A statement issued by the Engineering Development Board, after a meeting of exporters of engineering goods with its Chief Executive Officer, has detailed Duty and Tax Remission on Export (DTRE) scheme related issues hurting the sector as raised on the occasion.
The meeting which was convened, essentially, to discuss DTRE problems was told that Pakistan was losing export opportunities, basically, due to a glaring lack of provision for duty-tax-free temporary import of tools and machinery for the engineering sector, and for subsequent re-export of finished goods made therewith.
Seemingly, distressed by the case-to-case basis system in this regard, the exporters stressed the need for its replacement with the passbook system, as used in India. They viewed the scheme in vogue as time-consuming, more so for want of properly trained CBR staff to meet the special needs of this sector. Among other problems facing the exporters, they also referred to the non-issuance of zero-rated sales tax invoices by their suppliers.
From all indications, in convening this meeting the EDB appears to have before it the need for adequate support to the engineering sector in order to help it exploit its full potential.
This should become evident from the EDB CEO's opening remarks, in which he minced no words in observing that the DTRE scheme was not oriented to the engineering sector, hence causing difficulties. At the same time, he also said that, as a facilitator, EDB seeks to take up exporters' problems with the CBR so as to help the sector increase its exports, while he urged the engineering industry to enhance its competitiveness in the world market.
Mention, in this context, may also be made of his reference to the Board's plan to organise a series of seminars for increasing awareness of DTRE and financing schemes of the State Bank, with the first of these events scheduled to be held on September 20.
Later, speaking at a press conference, held to brief newsmen on the working of PUM, an organisation of Dutch experts, which runs a government-funded, cost-free, technical support programme in developing countries, he noted that the EDB had been playing the role of mediator between the industry and the foreign experts in order to help it benefit from their expertise for enhancing competitiveness and productivity, which the Pakistani industrialists desperately need.
Significantly, Leen Hanenberg, the leader of PUM team, dilated upon the activities and modus operandi of his organisation, saying it introduces new products, technical innovation, and effective market approach in developing countries by providing direct and indirect support.
As for its role in Pakistan, recalling that it had been working here since 1990s, he stated that though suspending its activities in 1999 due to "political unrest", it had resumed working in 2004, and inputs of Dutch senior experts had stimulated many Pakistani firms in the past to achieve success.
It will, thus be noted that renewed efforts for revitalising the variously distressed engineering sector, in the light of the objectively conceived "Engineering Vision 2000", have been showing positive signs of recovery, not as much from use of props and incentives, but from the enlightened self-interest of the private enterprise.
However, much more will be seen left to be desired. For it was three years ago that EDB decided to phase out various industries enjoying protection from tariff concessions, in view of the challenges the industry has to face in the WTO regime. Reference, in this regard, may be made to new investment of Rs 4 billion in the vendor industry in 2002 alone, which also helped create some 100,000 more jobs.
Be that as it may, laudable though have been its other achievements are, the machine-building part of the gigantic thrust, has remained unnecessarily ignored. This, in view of the neglect of the crying need of the textile industry, which continues to remain largely dependent on imports, should bring to the fore the predicament of the engineering sector, in view of the tough competition it has already started facing and is likely to face more in the years to come.