KARACHI, Feb 10: While businessmen hail the US move on lifting restriction on exports to Pakistan, they feel that it should have done more—in terms of concession in duty and a better market access to support economy in a more meaningful way.

There may be some relief for the defence sector of the country, but there is nothing for the trade, industry and export-oriented sector, businessmen said while commenting on the recent US move.

The US President George W Bush on Wednesday waived restrictions on exports to Pakistan, saying it would ease the democratic transition in the South Asian nation and help combat terrorism.

Mr Bush said he was easing prohibitions under the Appropriations Act, which targets countries where a democratically elected government has been overturned by a coup. He waived, with respect to Pakistan, the prohibition contained “in the Foreign Operations, Export Financing and Related Programmes Appropriations Act.” The waiver would “facilitate the transition to democratic rule in Pakistan” and is “important to the United States efforts to respond to, deter or prevent acts of international terrorism.

Reacting to the US move, Chairman Site Association of Industry, Amin Bandukda said that the US should had given duty concessions on Pakistani textiles and other items besides, assuring more market access.

It is good that the USA has recognized that democracy now prevails in Pakistan — a country that supported the US efforts in fighting terrorism. Pakistan Army and other defence related organizations would benefit but the trade and industry would not benefit from the decision, he added

Former chairman Site Association, Majyd Aziz thinks that the telecom and its related fields might benefit as both are undergoing a massive deregulation process in the country.

The decision may help Pakistan to import telecom technologies from the USA and it will give impetus to the US companies to set up joint ventures and invest in Pakistan in telecom sector.

However, he said that it was a good sign that the super power has finally acknowledged the existence of democracy in Pakistan, which will encourage other Western and European countries in diverting their investment and fostering bilateral and economic relations with Pakistan.

However, he said that the USA should remove the bottlenecks in bilateral investment treaty.

He said efforts should now be made on signing a free trade agreement (FTA) at the earliest and it is now imperative that the USA should offer same package and incentives which it offers to Bangladesh and Sri Lanka in textile exports, such as duty concessions and market access.

General Secretary, Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Dr Khalid Amin said that the USA should have come out with zero per cent duty on Pakistan textile and other items besides, ensuring full market access which it has offered to Bangladesh.

“There is nothing good for the trade and industry in the recent US decision on exports to Pakistan,” he said.

There must be an incentive package for Pakistan for being a front-line state in combating terrorism with the USA. There is a need for duty cut and market access for Pakistani textile goods to the USA.

A market expert said that the US package, in lifting restrictions on its exports to Pakistan, is only aimed at releasing its military scraps in the name of exports.

Pakistan may be dying to have decades old F-16 and other items which do not match with the items being sent to Israel. On the other hand, he said, that India is not willing to have latest US defence equipment and fighters like F-18 as it is more interested in up-gradation of know-how and technical skills for its young generation and human resource development.

On investment side - American firms remained reluctant to invest in Pakistan on various grounds. The share of US investment in 2004-05 was only $326 million, out of the total inflow of $1.5 billion foreign direct investment (FDI) in Pakistan in 2004-05. Surprisingly, in 2001-02, the US share of investment was also $326 million when total foreign direct investment was $485 million.

The share of US investment as percentage of the total FDI has actually declined over the last five years. Since then the US investment has declined to $212 million in 2002-03 as against overall FDI of $798 million and to $238 million in 2003-04 when the total FDI was $949 million. Hence, the total FDI in Pakistan continues to grow up but the US investment remained fluctuating during the last five years.

According to a report published by the American Business Council (ABC), only two new US based companies had become member of the council, raising the membership to 60 in 2004-05 as compared to 58 in 1999-2000. In 1985-86, the ABC had 35 members, rising to 53 in 1989-90 and to 61 in 1994-95. The ABC members operate in various industries, such as healthcare, financial services, IT, engineering, chemicals and fertilizers, energy, food and beverage, oil and gas and other sectors.

Majority of the ABC members have planned investment in Pakistan in the next 12 months as they are optimistic about the overall business climate and domestic economy. There are no specific figures of the future planned investment as well as the sectors in which the investment will be made. However, they feel that the law and order is still an issue confronting the new investment.

The US investment in Pakistan remained very dismal as US investors remained very concerned about the law and order situation and other problems.