KARACHI, May 10: Pakistan’s exports to the member countries of the Association of South Asian Nations or Asean rose slightly to $262 million in nine months of the current fiscal year from $254 million in the same period of the last fiscal. Full year exports may also not show any significant increase.
Analysis of the export data contained in the State Bank’s Statistical Bulletin show that Pakistan’s exports to 10 countries in the fold of Asean stood at $342 million in fiscal year July-June 2003-04, almost unchanged at the 2002-03 level of $341 million.
The Asean countries include Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam. Pakistan’s exports to four of these countries namely Indonesia, Malaysia, Singapore and Thailand account for the bulk of its total exports to the Asean region as other six countries are not major destinations of Pakistan exports. See Table.
Pakistan is making efforts to boost its external trade with the Asean countries through free trade agreements with them and the ongoing visit of Prime Minister Shaukat Aziz to these countries is a part of the efforts. Islamabad is also trying to become a dialogue partner in Asean for this purpose.
The agreements for boosting bilateral trade with Asean nations signed during Mr Aziz’s visit there, and the promises held out by some of them to also sign free trade agreements with Islamabad would take some time to yield results. But the fact that there exists a vast market for Pakistan’s exports in the Asean market can hardly be over-emphasized.
Analysis of data shows that Pakistani exporters have been exporting a variety of products to Asean countries including both conventional and non-conventional items. The list of major items exported to Asean region in fiscal years 2003 and 2004 and also in July-March 2004-05 include cotton and textiles, cotton and wool fabrics and made-ups, rice, wheat, fish, leather and leather products, fruits and vegetables, carpets, oilseeds, petroleum products, medicines, medical & surgical instruments and plastic, etc.
Pakistan’s exports to Asean remained unchanged in fiscal year 2004 compared with 2003 and even this fiscal year, exports to Asean are likely to remain at the last year’s level or slightly above that. This means Pakistan needs to boost its exports to the 10 Asian nations aggressively to keep overall exports growing. During the current fiscal year, Pakistan is expecting to earn $14 billion through exports, up from $12.3 billion.
Exports in nine months of the current fiscal year have already reached $10.207 billion. Pakistan needs to boost its exports much aggressively in the coming years than in the past because a faster-than-projected growth of its economy and skyrocketing of oil prices in the international market has resulted in a sharp increase in imports. If the pace of growth in imports continues to outdo the rate of increase in exports, the resultant huge trade deficit will create immense problems for the country. Already in nine months of this fiscal year, the deficit has soared to $4.262 billion from $1.592 billion in a year-ago period.
Clearly, the country needs not only to widen the base of export items but to explore newer markets and boost exports to those existing markets including the Asean region whose share in Pakistan’s overall exports is very small. If this year’s exports reach $14 billion, chances for which are very fair, and if exports to Asean region rises to $350 million, which also is a possibility, the share of exports to Asean will be just 2.5 per cent of the total. So, there is an urgent need for both the government as well as the private sector to look for ways to boosting exports to Asean.
This has become all the more necessary because Pakistan has so far not been able to grab a fairly large share of additional market in textiles exports after the end of quotas from January.
|Pakistan’s exports to ASEAN countries|
|[Amount in million dollars]|
|Countries||Fiscal year 03||Fiscal year 04||July-March 05|