In one of the most recent sessions of National Assembly, the finance committee figured out that the only way to pull Pakistan out of the depths of economic turmoil is through boosting the exports of the country, by promoting local goods and pushing them in the foreign markets.
Local industry is currently asking the government to stop the use of imported goods and products so that they can get a chance to flourish.
Businessmen present at the meeting emphasized that the government should slow down the imports of goods so that local industries can benefit from the increased demand. Recently, the government levied import duties on more than 350 items, which also included import of new cars, in order to end consumer reliance on the imported products.
The idea of exports going down can be understood from the fact that exports of engineering goods in Pakistan have gone down by 5-15% over the last five years, according to Engineering Development Board (EDB). While exports went down on one hand, Pakistan also lost its foreign investment in the mining industry.
For the first time in three decades, foreign investment in the mining industry came down to zero despite the existence of several mineral reserves in Pakistan. While Pakistan lost the foreign investment, other European and Asian countries are now growing on the back of engineering and mining sector. The future of Pakistan’s economy appears bleak as investors believe that there is no charm in these sectors.
During the meeting, it was also identified that the bureaucracy has turned out to be a major hurdle in the growth of Pakistani goods, as they are encouraging imports and domestic products are facing tough competition due to imported items.
Exporters are paying billions of rupees per year to customs department for the import of goods and raw materials. About Rs. 3 billion is being paid to the customs department in Karachi only.
There was a consensus that the government needs to launch an export emergency process that can provide subsidies to the exporters and fuel their growth so that the current account deficit of the country can go down. Arif Habib also said that the government should also revive the IT and construction sector or else Pakistan would lose the market to the likes of India, Bangladesh, and Srilanka.