After many years, Pakistan’s exports seems to be on the right track and increasing at a desired pace. According to the available figures, exports had reached $6.14 billion in the first seven months of the fiscal year, July 2002 to January 2003, showing an upward swing of 19.08 per cent over the corresponding period of the last fiscal. Thus the country has achieved a little over 59 per cent of the total export target, set at $10.4 billion.

Earlier, the exports had crossed the $5 billion mark in the first half, besides maintaining an average of $800 million earning every month — both for the first time. This, no doubt, is an encouraging sign for a country whose exports have been hovering around at $8 billion for last many years, before reaching $9 billion in the last fiscal. While exports seem to be leading the course of the long expected turnaround in the economy, efforts are needed to maintain this trend.

Exports started picking up in the middle of the last year on the back of increased orders from buyers in the United States and the European Union. This has been possible after the increase in market access quota for our textile exports, both by the US and the EU. Though this facility is expected to last for sometime more, there is no room to slow down the struggle aiming at capturing a greater share in the global markets for our products.

The need for such a struggle becomes more evident seeing the atmosphere of increased competition in the days of quota-free world that would be in place by January 1, 2005 under the Agreement on Textile and Clothing (ATC) of WTO regime. Concerted steps are needed to be planned and implemented, both at the level of exporters and the government, to maintain this growth and further increase it.

Firstly, exporters should continue to pursue aggressive marketing of our products in international markets. Our exporters have not been able to fully benefit from many restrictions lifted by the US on textile imports from Pakistan. So strong is the demand for imported textile in the US that it has forced a large number of local textile units to close down their operations.

No doubt quality consciousness of our exporters has developed over the past few years.Many Pakistani textile products are now considered of international standards, and are in increased demand. All that we need is to market our products effectively and maintain their quality standards, rather improve them. Secondly, our exporters must make themselves fully aware of the rules of the game in the emerging scenario and follow them completely. The EU is imposing anti-dumping duty on imports of bed-linen from Pakistan. This is happening after the local industrialists raised allegations of dumping of the bedwear by the Pakistani exporters in the EU market, and a case was initiated on their request. Thus the exports of close to a billion dollars are at stake in the days to come. Exporters should ensure that such hurdles are not created in the way of exports. They must maintain vigilance against unscrupulous elements among them that might ship one or two consignments at cheaper rates for quick gains and ignite controversies like dumping charges.

The textile industry, which already accounts for over 60 per cent of the total exports, has largely led this growth in the last months. Bulk of export earnings, up to 90 per cent according to some estimates, were contributed by the textile industry in this period. The need for diversification of exports is imperative. Despite high talk of increasing the non-traditional exports, there is no reasonable development on this front. Full potential of exports can not be exploited until comprehensive strategies are formulated to market and sell items like leather, gems and jewellery, fruits and vegetables in the outside world. Exports of these items have not been encouraging in the recent past.

The diversification of markets has also assumed critical importance. Commerce Minister Humayoon Akhter was right in pointing out recently that Pakistan’s exports were concentrated in the US, the EU and the Middle East.

Around two-third of our total exports find destinations in these areas and the remaining one-third go to the rest of the world. Export strategy should focus on finding a place in other markets of the globe including the Central Asia, Africa, Latin America and East Asia. It may be pertinent to note here that the volume of our trade with China is meagre as compared to the EU and the US. After becoming a member of the WTO, China offers a huge market for products that are competitive, both in terms of price and quality. We should try to reap maximum benefits out of this situation.

The responsibility for market diversification does not rest on the shoulders of exporters only. The government functionaries have an important role to play in this regard. The Export Promotion Bureau needs to pursue an aggressive marketing campaign in less explored markets around the globe. Further our trade counsellors in such regions should work hard to enhance the country’s exports.

The government’s efforts for free trade agreements with some African countries and Sri Lanka are a step in the right direction. But a lot more efforts are needed on this front.

The government, on its part, should give priority to the solution of various problems faced by exporters and encourage them through incentives. One such problem currently being faced by them is that of tax refunds. The CBR is reported to be holding some Rs30 billion refunds due to exporters.

Is it a reward for the sector performing excellently in the last half year? Exporters are compelled to obtain money from the market at higher commercial interest rates that will certainly increase their cost. The cost of production is already very high as compared to other countries.

Returning recently from the Hiemtextil Fair in Germany and meeting the EU Trade Commissioner in Brussels, Humayoon Akhter himself observed that the higher input cost, especially that of the utilities has severely affected our exports.

This should also be rationalized for a sustainable growth of economy in general and exports in particular.

A number of exporters have also expressed their reservations about the Duty Tax Remission for Exports system. The government should pay heed to such reservations and make the procedures simple for exporters, facilitating early and easy refunds to them.

Some 200 Pakistani textile exporters could not make it to the Hiemtextil Fair, as they were not granted visa by the German embassy. It is up to the government to ensure that such hurdles are removed and exporters are able to participate in the exhibitions worldwide. It is important to take note of the trade deficit, which is also swelling due to sudden increase in the volume of imports. Standing at $573 million, it has gone up by 24.19 per cent. To keep it at a reasonable level, a continuous upward trend in exports is necessary. And this can be realized through joint public-private strategies and efforts.