December 14, 2006	Thursday	Ziqa'ad 22, 1427

ISLAMABAD, Dec 13: Commerce Minister Humayun Akhtar Khan has said the high cost of production made Pakistani products less competitive against the Chinese and Indian goods in the international market.

Addressing a press conference here on Wednesday, the minister said that higher inflation, capital cost and energy prices during the last few years rendered Pakistani products less attractive for buyers in international market. This can be one of the reasons for dwindling exports during the five months of the current fiscal year, he added.

To a question he said that it was the responsibility of the government and not exporters to provide a level-playing field in the form of preferential market access, reduced cost of doing business by allowing special incentive packages for those sectors facing competition from other countries.

The minister said his ministry was working on a strategy to help the exporters to keep up pace of exports, which registered an increase of 23.9 per cent in the month of November, 2006 as compared to the corresponding month of last year.

The minister was not clear whether the current monetary policy of the government would help in reducing the flow of imports. However, he argued that in percentage terms the growth in imports during the first five months of the current fiscal year over last year was less.

He also avoided comments on questions seeking his opinion whether the government should devalue the rupee or not. He replied that the questions should be asked to the State Bank governor.

To a question the minister said that the export of defence products has risen from $250 million to $270 million during the last year from $50 million a few years ago. He said that proper reporting of these statistics would also be available for comments in near future.

The minister informed that the most heartening external trade aspect was that exports of textile and clothing to the EU and USA, which accounts for more than 50 per cent of the export of textile and clothing, have increased.

He said that the federal bureau of statistics (FBS) was compiling figures of export and import of services. The export of services during July-October amounted to $1.048 billion against import of $2.608 billion for the same period, leaving behind a big deficit of more than $1 billion.

“We are attaching high importance to the trade diplomacy, which is now bearing fruit as Pakistan has gained market access to China through recently concluded FTA. This will spur exports, particularly of home textile,” he added.