ISLAMABAD, Sept 5: A Senate body on Friday observed that the country must focus on increasing non-traditional exports like gems and precious stones, sea-food, handicrafts and herbal health supplements, which have a big market in addition to pharmaceuticals, furniture, minerals and other commodities.

The Senate Standing Committee on Commerce which met here under the Chairmanship of Muhammad Amin Dadabhoy to discuss the contours of the export policy also underlined the need to promote floriculture exports and called for simplifying procedures and providing more incentives to exporters.

It observed that export diversification was necessary to achieve the country’s export target. It expressed satisfaction that the country’s exports increased from $17 billion in 2006–07 to $19.22 billion in 2007–08 registering a growth of 13.23 per cent.

Some members of the committee observed that “on one side we are keen to increase and expand exports but on the other side the cost of doing business is increasing rapidly due to high interest rates and ever increasing prices of gas and electricity”.

They urged the government to overcome this apparent dilemma by innovative policies.

The secretary commerce informed the committee that for the current year, an export target of $22.1 billion had been set i.e., a growth of 15 per cent over the previous year.

Despite unfavourable international economic situation, the government was confident to achieve the target by enhancing competitiveness and productivity on one hand and diversification of products and markets on the other.

He said that in order to reduce cost of manufacturing and to make exports more competitive, it was proposed that plant, machinery and equipment imported to set up a unit in DTRE scheme would be exempt from duty and taxes.

This would result in reduced cost of investment and boost export and generate employment, besides inputs in DTRE would also be allowed to be imported from India, even if these were not included in the importable items from India, or manufactured locally.

The government, he said, is also committed to providing ‘zero rating’ to exports by refunding of indirect taxes on input cost incurred on manufacturing of merchandise, which is exported and a study will be conducted jointly by the FBR and the Ministry of Commerce to quantify the extent of refund, which will become due on this account.

The committee members expressed the confidence that businessmen and exporters had the potential to come up to the expectations of the people and the government provided they were given the right kind of incentives, duly supported and governed by favourable policies.