The government is going to rationalize the tariff structures and customs duties in the mini-budget it is planning to present in the next month.
Adviser to the Prime Minister on Commerce, Textile, Industry and Production and Investment Abdul Razak Dawood revealed this while addressing the business community at Islamabad Chambers of Commerce and Industry. He said that the government will fix tariffs for at least three to four years after the rationalization process to provide the industry with a clear future roadmap.
According to Mr. Dawood, the current tariff structure and customs duties are not spurring industrial growth, and there is an urgent need to address this issue.
The policy will be industrialization-driven instead of revenue-driven. The Adviser to the PM said that flawed policies of the previous regimes led to de-industrialization in various sectors. But, the current government is determined to reverse this process and put the country on the path of sustainable industrial growth, he pledged.
Abdul Razak Dawood said that Pakistan was depending on textiles for exports but its share in the international market was coming down.
He said that a concept note of industrial policy has been prepared and the new industrial policy will promote other industries including engineering, chemical, information technology and agriculture to diversify exports.
He further said that the new industrial policy would support strategic industries and strengthen import substitution industries. He added that the government has planned to increase exports by up to $50-$150 billion by facilitating export-oriented industries.
He mentioned that currently Pakistan has signed Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs) with five countries. However, he believes that except for the FTA with Sri Lanka, all FTAs were unfavorable for Pakistan.
To resolve this imbalance, the government is working to revise the FTAs with all countries, and that the second phase of FTA with China would be completed by June 2019. He said the government was in discussion with many countries including China, Malaysia, South Korea, Japan and Turkey to get more market access for Pakistani products. Indonesia has provided zero-rated market access to Pakistan on 20 items.