ISLAMABAD, Aug 25: The import bill is likely to reach around $28 billion during the year 2005-06 following the persistent rise in the oil prices in the international market, officials told Dawn on Thursday.
They said that the massive tariff rationalization during the last budget would also help in increasing the import bill of machinery, raw materials and consumer goods during the year under review thus putting more pressure on the reserves of the country.
The officials said that during the first month of the current fiscal year over 30 per cent growth was recorded in import bill over the same month of the last year.
According to the officials, the commerce ministry keeping in view the current surge in import of machinery and raw materials during the last two years is anticipating that the import bill might reach close to $27 billion during the year under review.
The statistics showed that Pakistan import bill registered an average growth of around 19 per cent during the last six years as import bill increased from $10.309 billion in 1999-2000 to $20.623 billion in 2004-05.
With tariff rationalization, particularly on the machinery and raw materials, the import bill registered a growth of 18.18 per cent in 2002-03, 27.59 per cent in 2003-04 and 32.3 per cent in 2004-05.
Interestingly, the actual import bill realization during the last two to three years had been surpassed the projections announced in the trade policies. As the government projected import bill at $12.8 billion for the year 2003-04 but actual import bill was $15.472 billion.
The import bill projected for 2004-05 was $16.7 billion but the actual import bill reached $20.623 billion.
With these, the commerce wizards have now realized that actual imports realization would now be very much close to the $27 billion as government had announced zero rating of sales tax, customs duty, withholding tax on import of five major sectors — textile, carpet, sport, leather and surgical goods.
It was likely that exporters would import machinery for rehabilitating their production capacity, and import cheaper raw materials that could result in increasing the import bill of the country.
When contacted senior customs officials told Dawn that during the budget of 2005-06, the government had allowed 5 per cent customs duty on 2,479 tariff lines as against 1,503 tariff lines during the last year besides exempting machinery and certain raw materials from whole of customs duty.
The 25 per cent duty tariff lines have been reduced to 1,543 tariff lines from existing 2,147 tariff lines to further facilitate the trade; 20 per cent duty on 821 tariff lines; 14 per cent duty on 150 tariff lines, 15 per cent on 200 tariff lines and 10 per cent only on 864 tariff lines.
The total customs tariff lines stood at 6,315 tariff lines in the Pakistan Customs Tariff.
The customs officials said that due to this massive exercise of tariff rationalization, it was most likely that imports of machinery, raw materials and other products would register a massive growth that could increase the import bill in 2005-06.
