How then will the exports fare in 2022 amidst the tightening monetary policy and intermittent gas crisis? Pretty well, answer stakeholders with unfading optimism.
Rice: “Rice exports will increase at least 15 per cent,” says a former chairman of the Rice Export Association of Pakistan, talking about 2021-22. Dismissing concerns about water shortage or increase in cotton acreage that could decrease rice cultivation, he speaks of farmers that rakes in huge profits from hybrid rice crops in the last couple of years, a trend he expects will continue in 2022.
Textiles: “Given the colossal capital investment in 2021, textile exports will continue to grow this year,” says Patron in Chief of the Pakistan Textile Exporters Association Khurrum Mukhtar.
“Interest rates have increased which impacts our margins. Electricity cost is at par with regional competitors, whereas captive gas price hike is a temporary phenomenon up to March 31, 2022, only. We hope the government will honour their commitment and rationalise gas prices from April 1,” he says in answer to the question about the challenges it faces.
Cottage industries: “Our exports were consistent even during the pandemic,” claims Mian Naeem Javed, former president of Sialkot Chambers. While explaining that their success lies in developing infrastructure independent from the government, he praises the increase in liquidity through facilitating drawbacks. “You cannot comprehend the scope of exports in these sectors,” he adds, painting a rosy picture for future exports.
Recovering global economies add fuel to hope even as Omicron makes its presence felt. In the US, Americans are in line for their biggest wage increase in more than a decade, according to recent reports. Businesses are expected to bump up pay an average of 3.9pc in 2022 — the fastest wage growth since 2008. And this will put money in the pockets of some of the most important consumers of Pakistani exports.
The ministry of finance is predicting record-breaking exports of $31 billion at the end of the current fiscal year. In 2021, till November, exports were $25.6bn. If each month of 2022 was like November’s $2.9bn exports, it is not inconceivable that for once, forecasts may not fall far off the mark if the business leaders are to be believed.
Published in Dawn, The Business and Finance Weekly, January 3rd, 2022
