The Islamabad Chamber of Commerce and Industry (ICCI) has shown great concerns over the rising trade deficit of the country which has gone up to an all-time high of over $23 billion during the first nine months of the current financial year showing an increase of over 38% compared to the same period of previous year. The Chamber termed it a dangerous trend as it would create serous balance of payment problems, push the country towards heavy borrowing and plunge the economy into further difficulties.
Khalid Iqbal Malik, President, Islamabad Chamber of Commerce and Industry said that the overall import bill of Pakistan has increased by more than 18% during July-March 2017 reaching to over $38 billion while the exports of the country during the period have come down to around $15 billion which showed that the economy was heading towards troubled waters. He was afraid that if the current trend of rising trade deficit continued, it could reach around $30 billion by the end of this fiscal year.
He said the most disturbing fact was that the trade deficit has been rising for the last four years, but the government did not take any concrete measures to arrest this threatening development. He said that under the Strategic Trade Policy 2015-18, the government had set annual export target of $35 billion by 2018. However, viewed in the context of current trend of exports, this target seemed almost impossible.
Khalid Iqbal Malik said that under STP 15-18, government had announced some incentives for exporters to improve product design, encourage innovation, facilitate branding and certification, upgrade technology for new machinery and plants, provide cash support for plant and machinery for agro processing and give duty drawbacks on local taxes. However, he said that these incentives have not fully benefited the exporters due to cumbersome procedures involved in availing these schemes.
He called upon the government to address the key issues of exporters on priority basis and evolve a comprehensive new strategy in consultation with private sector to boost exports through diversification and value addition of products. He said the workers remittances were also showing declining trend and urged that government should focus on new markets including South Korea, China, Malaysia and other potential countries for manpower export.