June 04, 2007	Monday	Jamadi-ul-Awwal 18, 1428

PRIME Minister Shaukat Aziz has said that exports in this financial year will marginally miss the target of $18.6 billion, but the economic growth will be above the target at 7.2 per cent, exceeding last year’s growth of 6.8 per cent.

Exports are able to grow by three to four per cent only, says Chairman of the Trade Development Authority of Pakistan Tariq Ikram while the rate of economic growth exceeds seven per cent.

Commerce Minister Humayun Akhtar, who has recently returned from tour of Europe, says the commerce ministry is not solely responsible for the disappointing exports. The financial managers of the country are focused on higher revenue collection, lower external debt and higher economic growth, and achieving success in that area. He wants lower taxes in the exports sphere and larger concessions to the exporters to make exports cheaper and more competitive. But the authorities find that even when more concessions are given, they have not lead to exports’ success and the results are far from adequate.

Usually when the growth rate is high and tax resources are larger, the exports are also higher. In fact many countries in recent times have enjoyed export-led growth instead of growth becoming a deterrent to larger exports.

Mr Humayun is right when he says that exports are not any longer the sole domain of the commerce ministry. The commerce ministry can help export only on what is produced at competitive prices. And that is the responsibility of the ministry of textiles and the ministry of industries. Also in the picture is the ministry of investment promotion to accelerate industrial investment and development of the economy and increase in production all round..

The old export promotion bureau is also in focus which has now rechristened as the Trade Development Authority with Tariq Ikram as its chairman with all his energy and drive, but he finds himself cluttered by too many organisations in the export race. Of course the last word in this area is with the finance ministry with the Central Board of Revenue in tow as the prime minister is also the finance minister.Any decision made by the prime minister cannot be reversed easily.

And the prime minister’s priority is maximising the revenues spent on official activities and on larger development projects. Of course he listens to his ministers when they have a genuine problem.

The expanding textile industry has been agitating for long for a ministry of textile and that has been stoutly resisted by the commerce and industries ministers. They used to argue that if 40 per cent of the industry goes out of the industries ministry, too little authority is left for them and the commerce minister used to argue that if 66 percent of the exports which were textiles were out of his purview, his portfolio will shrink exceedingly. But now for some years, we have not only a textile minister with a cabinet rank but also a minister for state, although there is not enough work for both.

It is to avoid a conflict between the demands of trade and industry that the US has a powerful commerce secretary but no industries secretary. Similarly, Britain has no industries minister but a powerful board of trade headed by a cabinet minister and Japan’s Miti - ministry of trade and industries- is too well known and is very powerful. The ministry looks after the interest of both trade and industry and avoids conflicts between them.

As for the commerce minister’s charge that the government gives priority to revenue collection which hurts exports is only partly valid. Cheap yarn as a result of tax concessions results in cloth abroad which competes with Pakistani fabrics and the government argues that more concessions given to the textile industry results in larger demand which has no end.

Any way, the cost of production of textiles as of any other product has to be lowered and the sale price made more competitive in a highly competitive textile world.

It is because there is not enough work for him as minister of industries and production that Jehangir Tareen has appended to his designation the title of minister for new initiatives as well, but we have yet to see any spectacular new initiative coming from his ministry. We need such new initiatives in the industrial sphere with its too many ministers doing too little or more of the same over and over again.

Whatever happened to the one village, one industry project copied from Thailand with a great deal of bravado. We have yet to see something coming out of that.

Too many cooks spoil the broth and too many ministers seem to stifle the export trade and produce a mole hill out of a mountain of verbiage.

It is time the prime minister takes a look at the economic portfolios and reassigns them more productively instead of letting the ministers block each other or let the other ministers do their job which he is not doing.

Do we need to clutter the seeds of power with too many ministers and call some of the ministers to be made ministers without portfolio while others are permitted to deliver what they promise.