Parliament Panel Recommends Adding Incentives for Phone Makers to Setup in Pakistan

A parliamentary panel on Tuesday recommended incentives for mobile phone handsets manufacturers, similar to other sectors like Power.

The Senate Standing Committee on Commerce and Textile Industry met with Syed Shibli Faraz in the chair, where serious concerns were expressed over the widening trade gap.

Committee chairman said that mobile phone handsets of around one billion dollars were imported during the last year. He said that concessions should be given to investors to come and establish plants on the pattern given in other sectors to curtail import bill.

Trade-Related Investment Policy to Provide Incentives to Investors:

Secretary Commerce Mohammad Younus Dagha said that “Trade-Related Investment Policy” covering 19 sectors is on the card where major incentives to be given to investors.

He further said that a policy has been planned to rationalize import bill including raising duties by three times.  Secretary Commerce said that country’ export was $23.3 billion while import stood at $59.6 billion in 2017-18.

The committee chairman Syed Shibli Faraz recommended the Commerce and Textile divisions to come up with practical measures to increase exports as old policies/old system would no more work in “Naya Pakistan. There is need of new economic and trade policies to overcome economic challenges, he added.

The Problem of Pakistan’s Increasing Imports:

Dagha said that there are two causes of increasing trade gap. Exports decline due to preference erosion because of China- ASEAN FTA (2010-11) and supply-side constraints including energy issues, security concerns and reduction in commodity prices.

Surge in imports was due to 40% (USD 4.3 billion) increase registered in products placed in No Concession list or 20% concession category, remaining constitute machinery @ 3% MFN and intermediate/raw material which are vital for industrial and economic growth and duty free imports under China Pakistan Economic Corridor (CPEC). The Secretary also admitted that under-invoicing and absence of Electronic Data Exchange (EDE) system were the major reasons behind the widening trade gap.

Committee chairman recommended the Secretary Textile division to come up with practical measures to enhance country textile exports from the current around $12-13 billion to $20 billion by 2021.

The committee also took notice of worth million rupees of textile machinery stopped by the Federal Board of Revenue (FBR) at port. The committee directed the chairman FBR to report in ten days.



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