ISLAMABAD, Oct 31: Pakistan on Friday reduced customs duty on two polyester staple fibre (PSF) items from 20 to 15 per cent to meet a European Union condition to provide greater market access to Pakistani products.
A decision to this effect was taken by the Economic Coordination Committee (ECC) of the cabinet presided over by Finance Minister Shaukat Aziz.
The committee considered in detail the memorandum of understanding (MoU) signed with the EU in 2001 in as much as that as per cabinet’s approval, the tariff rates on polyester staple fibre exceeding 2.22 decitex (5503.2090) and also on PSF carded and combed or otherwise processed for spinning (5506.2000) were not to exceed the bonded rates of customs duty.
Accordingly, the rate of custom duty on these two items will be immediately reduced to 15 per cent from 20 per cent. However, PSF up to 2.22 decitex will continue to attract customs duties at 20 per cent. The compliance of EU’s MoU will pave the way for negotiating greater market access of Pakistan’s textiles to EU countries, an official statement said.
The EU has been asking the Third World countries, including Pakistan, to reduce and harmonize customs tariffs of various textile and clothing items to enhance market access.
Pakistan’s exports crossed $11 billion mark during 2002-03 for the first time in the history, after getting additional quota allocations from the EU in response to Pakistan’s support to the US-led war against terrorism. The EU is the second largest trading partner of Pakistan.
The meeting also exempted oilseeds imported for sowing from 20 per cent GST to encourage the agricultural sector. However, the import of oilseeds for extraction of oil will continue to attract 20 per cent GST to give incentives to local farmers to produce more oilseeds locally.
To facilitate start of early crushing of sugarcane to enable farmers to prepare for wheat sowing and to encourage the sugar industry to settle outstanding dues of farmers, the ECC also amended its earlier decision and decided to immediately procure 100,000 tons of sugar.
The second instalment of remaining 100,000 tons will be procured as per earlier decision of the ECC from the mill owners in January 2004 provided they have cleared dues to sugarcane growers and start crushing season not latter than November 15.
The ECC was told that cotton production was expected to be in the vicinity of 10 million bales.
The secretary, ministry of food and agriculture, also stated that DAP supplies were adequate and Minfal was reviewing the situation on certain basis.
The meeting was informed that the Central Board of Revenue exceeded the target and collected Rs40 billion revenue in October, which was 13 per cent higher than what was collected during the same period last year. The total collection could touch Rs42 billion as final result of collection would take another 10 days to come in.