ISLAMABAD: The federal finance ministry has diverted about Rs11 billion export development funds for bridging the yawning current expenditure leading to poor implementation of measures announced under the Strategic Trade Policy Framework (STPF) 2009-12 for enhancing exports, it is learnt.
The finance ministry had withheld the amounts collected from exports proceeds since 2005-06, which has been diverted to other sectors especially to dole out hefty salaries and perks to platoons of ministers, state ministers, advisors, and special assistants.The export development surcharge (EDS) is levied on all exports at the rate of 0.25 per cent of fob value of goods. As per law, the entire receipts of EDS are transferred to Export Development Fund (EDF) in the following year. The government used these funds for implementation of measures to facilitate and enhance exports from the country.
A well-placed source in the commerce ministry told Dawn on Wednesday that the commerce ministry had recently approached Prime Minister Yusuf Raza Gilani for the early release of the entire funds of the EDS.
As a result of delay in release of funds the liabilities of the EDF projects have accumulated to Rs3.820 billion till June 30, 2011, the source said.
The prime minister was informed that the timely releases of required funding would help increase pace of export growth.
As per official statistics, the EDS collected Rs18.82 billion since 2005-06. Of this only Rs7.89 billion had so far been released to commerce ministry leaving Rs10.9 billion stuck up with the finance ministry.
An official in the commerce ministry said that initially the government had projected Rs27.7 billion for STPF initiatives for 2009-12.
Ironically for the first year of the implementation of the trade policy, the government projected Rs2.5 billion in the budget but no fund was released in 2009-10. A similar trend was witnessed in the following year but at the end the finance ministry released just Rs1 billion out of the committed Rs2.5 billion in 2010-11.
The government has projected an amount of Rs2.5 billion in the budget 2011-12 for implementing export promotion measures.
Analysts said the implementation of trade policy is the least priority of the government. However, many developing countries have increased their export earnings for meeting the rising requirement of foreign exchange and minimising the need for seeking loans to build up foreign exchange reserves, they added.
“This is the exporters' money and can only be used for the facilitation of the exports and the govern- ment has no right to divert such funds for other purposes as per law,” the source declared.
Dear visitor, the comments section is undergoing an overhaul and will return soon.