IT is encouraging that the country has witnessed a considerable growth in its exports in the 2020-21 fiscal compared to the the previous financial year. However, the exports have still fallen short of the target despite the country possessing a huge potential.
Pakistan’s major exports comprise agro-based commodities, which depend largely on the quality of crop, but the erosion of the industrial base and the phenomenon of de-industrialisation over the years, coupled with debatable imports, have left the country with little surplus for export.
The onslaught of the import of chemicals, toys, plastics and allied industrial products from China has resulted in the closure of the local nascent units in these sectors.
Modern international trade has become scientific and highly competitive, requiring compliance with a wide range of rules and standards. The removal of barriers in terms of tariff and quota has given way to non-tariff barriers (NTBs).
It is lamentable that the country has only lately obtained the intellectual property right (IPR) for Basmati rice and a case is still pending adjudication before the relevant forum in Europe. Our fruit exports were stopped as the orchards failed to follow standardised techniques. The same was true of our exports in terms of fisheries and livestock. The quality of engineering products, such as fans, has come under questioning. And, orders of shirts were cancelled by Japan because the machines used in the production process did not meet the standards.
Another major obstacle is that our entrepreneurs lack global exposure and continue to conduct trade along primitive lines. They need to be more professional and change their inward-looking approach and reliance on rent-seeking. The absence of innovation, lack of research and development (R&D), non-compliance with IPR, and un-skilled labour add to the cost of the goods, and result in substandard production, causing problems in international markets.
The national private sector must realise that the way of conducting trade has changed altogether. International buyers have become more knowledgeable than ever, and tend to purchase only the goods that are in line with their specifications.
Moreover, the business entities in Pakistan may also operate at massive scales by deploying automated equipment with modern manufacturing setups, providing training to its staff and enhancing their skills.
The emphasis should be on capturing diversified markets on the basis of production and product quality that should match international rules and regulations. On its part, the government must establish a facilitating environment for potential exporters.
Shahid Ali Abbasi
Additional Collector of Customs
Published in Dawn, June 16th, 2021