ISLAMABAD, Sept 11: The government is considering a proposal to ‘renegotiate’ existing agreements with foreign partners to permit export of cars and tractors from Pakistan.
Similarly, official sources told Dawn on Monday the government was contemplating another proposal, submitted by a group of experts, to encourage tripartite partnership amongst foreign investors, technology partners and local industrialists with assured work load.
But they urged the government to improve the country’s image in terms of law and order situation, environment, security, trained labour force, and cost of doing business.
These proposals were contained in the draft of "Technology - Based Industrial Vision and Strategy for Pakistan’s Socio-Economic Development" which was presented to the government for approval jointly by Pakistan Institute of Development Economics (PIDE) and Higher Education Commission/COMSTECH for substantially enhancing the share of industrial and engineering sectors.
Talking about the globalisation, the draft, a copy of which was also made available to Dawn, said that there was a need for relocation of industries from industrial countries to Pakistan by attracting large multinational companies to invest in Pakistan and make the country a hub of the global supply chain.
The government was also urged to make Saarc and Economic Cooperation Organisation (ECO) effective trade blocs.
It was advised to bridge the widening technological gap with the developed countries through invigoration of engineering industry by providing conducive environment including the required technological, financial and physical infrastructures, and creating a seamless integration with emerging trends of global production systems.
About the policy framework, the government was advised to formulate a long-term industrial policy with the consultation of stakeholders to avoid sadden business shocks.
The draft believes there is need to reform taxation system to ensure effective implementation of research and development tax benefits and timely tax refunds and that there is need to remove discrepancies/anomalies of preferential treatment of duty-free imports of products, particularly for infrastructure projects.
In this regard, the government was also urged to implement intellectual property laws and enforcement system and further rationalisation of tax and tariff regimes.
The government was also urged to invest $10-12 billion for increasing the share of industrial sector in GDP to 25 per cent and the share of engineering goods to 30 per cent of manufacturing by 2010.
This will provide goods of international quality at competitive prices for domestic and international markets, support other sectors of economy, and will facilitate in exploiting the niche in global translocation of industrial production.
To meet the target an investment of $10-12 billion would be required up to 2010, another $20-25 billion up to 2020 and $30-40 billion by 2030. It will initially generate employment for two million people.
If these joint proposals were accepted and implemented, the government was told that this would help increase the exports of engineering sector to $2 billon, $5 billion and $12 billion by 2010 and 2030 if low scenario of exports is assumed.
However, this can only be achieved through a growth-led strategy of value-added quality production.
The allocation of additional resources from the technology development fund, common facilities centres, technology centres and technical manpower development, the draft said, could take Pakistan to the path of rapid industrial development.
With continued cooperation between Central Board of Revenue (CBR) and the ministry of industries and production for further rationalisation of taxes, tariffs and SROs can positively affect the overall output of the country.
"Given the political will, commitment and patronage, it is possible to achieve these targets with full participation of the private sector stakeholders".