ISLAMABAD, Jan 15: Pakistan has started an exercise to identify services to be offered for investment to foreign service suppliers.

A report based on this exercise is expected to be submitted to the World Trade Organization (WTO) in due course of time.

According to sources, the commerce ministry had been asked to submit initial offers in the services sector to the WTO as early as possible. The sources told Dawn on Saturday that the commerce ministry had entrusted the task to a private sector consultant with a deadline of three months.

The sources said that most of developed and developing countries had worked out the initial offers in services sectors to WTO-member countries following an extensive deliberations with the relevant stakeholders of each and every services.

They had sought views on making offers in the services sectors through holding of seminars, meetings, publishing of articles, holding of interviews of experts and conducting surveys through electronic and print media before finalizing their initial offers.

According to the sources, the ministry has yet to start a full-fledged consultation with the relevant stakeholders to identify more areas of Pakistan's interest for giving access to the foreign service suppliers as well as getting market access for their services exports.

The ministry never took the issue seriously over the last 10 years, and any offers made in haste in the services sectors, it is feared, may cause more hardship to the poor of the country.

The need to be extra careful in this regard has arisen because of the past experience in liberalizing some of the services sectors which more often led to decline in quality and standards of services and increase the prices.

As international standards will be imposed under General Agreement on Trade in Services (GATS) on service providers, it will create an uneven playing-field for local service providers, resulting in huge job lay-offs, even closure of domestic businesses.

Developed countries have already provided due protection to their consumers by enacting consumer protection laws in their countries through which they could easily monitor the services of foreign countries. While in Pakistan, there was no law for consumer protection.

The major concern for developing countries in the liberalization of their service sectors was that consumers might become vulnerable to the whims of private concerns and confronts problems like those of equity and access, high tariffs, arbitrary price increase, non-availability of goods and services in certain conditions and deteriorating quality of goods and services.

The government should first take into consideration all these issues and then make offers to international investors for investment in the services sector, they said.

Foreign investment in the services sector like banking, insurance and health sectors would be good from consumer point of view, as quality of service would improve but there should be some regulation to ensure that they provided quality service to all consumers at reasonable prices.

The liberalization in the telecom sector was successful to a large extent, as the rate of charges reduced on the calls, while the liberalization in the power sector resulted in further deterioration of service and high tariffs.

Under the government's commitment with the IMF and the World Bank the privatization and de regulations in the services sector tariffs of services like electricity, natural gas and oil have increased many fold and those who were hard hit by these rising tariffs primarily constitute the poor.

Moreover, during the proposed move of corporatization of postal services not only a large number of post offices in remote and rural areas have been closed down in 2000, but the charges of ordinary inland mail have been doubled from Rs2 to Rs4.