impact of trade policy of Pakistan on imports and exports of Pakistan
Presented to: Presented by:
• Prof. Khalil Ahmad Rao • Nouman Rafique
• Muhammad Yousuf
• Zubair Ali
• Saqib Shahid
• Moazzam Naveed
3. Impact of trade policy of Pakistan on
imports and exports of our country
International trade and foreign
4. What is trade policy
• Trade policy is a collection of rules and regulations
which pertain to trade. Every nation has some form of
trade policy in place, with public officials formulating
the policy which they think would be most appropriate
for their country.
• The purpose of trade policy is to help a nation's
international trade run more smoothly, by setting clear
standards and goals which can be understood by
potential trading partners. Things like import and
export, taxes, tariffs, inspection regulations, and quotas
can all be part of a nation's trade policy.
5. Who make it
• The latest trade policy announced by the
Government of Pakistan was the Strategic
Trade Policy Framework for year 2009-12.
• Ministry of commerce make the trade policy
• Trade policy presented by the Makhdoom
6. Purpose of trade policy
• Set out the policy guidelines and identifying the principle
• Need for developing and effectively implementing a
national export competitiveness program.
• To provide the reference to different trade measures by the
Ministry of Commerce and other ministries from time to
• To achieve sustainable high economic growth through
exports with the help of policy and support interventions
by the government, industry, civil society and donors.
• Reducing the cost of business
• Protection and promotion of SME sector
7. Purpose of trade policy
• Enabling Pakistani exporting countries overcome
the negative effects of global demand
• Creating opportunities for employment
• Environmental protection
• Investing in human resources
• Poverty alleviation
• For promoting private sector as engine of growth
• For focus on small scale sector particularly in
9. Features of trade policy 2009-2010
• Full insurance cover for purchasers/importers coming
• Cement, light engineering, leather garments, furniture,
soda ash, hydrogen peroxide, sanitary wares including
tiles, finished marble/granite/ onyx products exporters
to be compensated for inland freight cost.
• 25% support to surgical instruments, sports goods and
cutlery sectors for brand development.
• 25% of cost of labs in tanneries to be borne by
government and 50% grants for purchase of flaying
machines at slaughter houses.
10. Features of trade policy 2009-2010
• 25% freight subsidy for live seafood products
exported by air.
• Processed food exports to receive 6pc of
export cost as R&D.
• Government to bear 50pc cost of certification
of halal products exports.
• 50% cost of quality certification for domestic
appliances to be borne by government.
11. Features of trade policy 2009-2010
• Tents and canvas, sports goods, footwear, surgical / medical /
veterinary / beauty care instruments, cutlery, onyx products,
electric fans, furniture, auto parts, handicrafts, jewellery and
pharmaceutical sector zero rated for GST.
• Machinery trade in old, obsolete machinery to obtain new,
refurbished and upgraded machinery allowed.
• US$10,000 per invoice as advance payment for urgent imports
• Engineering units exporting 50pc production to enjoy status of
export oriented units.
• Import of old and used computers to be allowed.
• Import of used cathode ray tubes disallowed.
• Vaccine imports restricted to import from WHO approved plants.
12. Features of trade policy 2010-2011
• Increasing a number of items mainly raw
materials from India in consultation with
stakeholders, improvement in Research and
Development, improvement in transit trade
and trade facilitation.
• To achieve the $23.5 billion export target by
• The total expenditures on three-year STPF are
estimated at Rs 35.22 billion.
13. Features of trade policy 2010-2011
• The government shall ask United States and
European Union to create a legal window for duty
concession on Pakistani products because
Pakistan has suffered a lot due to security
situation owing to frontline state against
• The Finance Division committed Rs 16 billion for
funding of trade promotion activities for the
current fiscal year 2010-11.
• The proposal to allow up to 5 years old and used
cars imported in the country has been dropped.
15. Important imports of Pakistan
• Vehicles and spare parts
• Edible Oil
• Plastic material
• Paper Board
• Iron ore and steel
• Pharmaceutical products
16. Important exports of Pakistan
• Raw cotton, Textile products and Cotton yarn
• Leather and leather products
• Carpets and rugs, Tents
• Synthetic textiles
• Surgical instruments
• Sports goods
• Readymade garments
• Vegetable, fruit and fish
• Engineering goods
• Chemicals and Pharmaceutical products
17. Targets for 2009-2012
Targets set by the Government (Ministry of Commerce)
Indicator Target 2009-2012
• Exports Target $US Billion 17.8 - 23.5
• Exports growth Projection 6% in 2009-10 $US Billion 18.8
10% in 2010-11 $US Billion 20.7
13% in 2011-12 $US Billion 23.5
• Competitiveness Ranking 101 < 75
• Engineering Sector Export Share 1.5% - 5%
• Expansion of Regional Trade 17% - 25%
18. Target and actual performance
Targets: Actual Exports:
• 2009-10: US$ Billion 18.8 • 2009-10: US$ Billion 19.5
• 2010-11: US$ Billion 21.5 • 2010-11: US$ Billion 13.2
• 2011-12: US$ Billion 23.5 (Till February 2011). It is
estimated that government
is likely to achieve exports
of $US Billion 22
19. Expenditures on strategic trade policy
• Ministry of Commerce • The current status of the
planned to spend Rs. 35 funding of STPF initiatives is
billion (2009-2012) for not satisfactory, after
implementation of STPF. completion of all
formalities. Ministry of
• The amount shall be spent Finance has released only 1
on research and billion and pended the
development. release of Rs 2.5 billion due
to financial constraints. This
has put STPF
implementation in jeopardy.
21. Annual increase/decrease in imports
• During the first quarter of 2011, imports from
the Asian continent, our major supplier,
amounted to Rs 19,501 million with a share of
56.2% of total imports.
• Compared to the first quarter of 2010 changes
noted in the import bill were: India (+50.2%),
China (+19.5%) and France (+17.7%)
22. Annual increase/decrease in exports
• In a presentation made at the meeting it was
informed that in the first 10 months of the
ongoing fiscal year 2009-10, exports have seen
a growth of 8.03%, which is above the target
set at 6% for the first year of the science and
technology promotion fund (STPF). If this
trend continues and energy situation
improves, overall STPF target of $23.5 billion
can be achieved by June 30, 2012.
23. Total value of trade and trade balance
• Total international trade for the first quarter of
2011 was valued at Rs 52,503 million, i.e. 11.1%
lower than the previous quarter but 22.2% higher
than the corresponding quarter of 2010.
• During the first quarter of 2011, total exports
stood at Rs 17,778 million against imports of Rs
• This results in a trade deficit of Rs 16,947 million,
compared to deficits of Rs 19,554 million (-13.3%)
for the previous quarter and Rs 14,646 million
(+15.7%) for the corresponding quarter of 2010.
30. Imports by country of origin
• During the first quarter of 2011, imports from the
Asian continent, our major supplier, amounted to Rs
19,501 million with a share of 56.2% of total imports.
• India (27.8%), China (11.6%), France (8.8%), South
Africa (7.9%), Spain (3.2%) and Japan (2.8%). The high
share of India in our import bill is explained by the fact
that India is our main supplier of petroleum products
since the last quarter of 2006.
• Compared to the first quarter of 2010 changes noted in
the import bill were: India (+50.2%), China (+19.5%)
and France (+17.7%)
31. Total imports of main commodities by section, 2009 - 2011 Value in million Rupees
Commodities 2009 2010
1st quarter 2nd quarter 3rd quarter 4th quarter 1st quarter
Food and live animals 22051 24606 5803 5572 6424 6807 5923
2103 2482 568 599 553 762 575
3174 3288 857 774 734 923 1177
inedible, except fuels
lubricants and related 18557 25929 5738 6610 6015 7566 9386
1321 1176 298 271 262 345 534
vegetable oils, fats
Chemicals & related
10711 12465 2310 2877 3174 4104 2714
classified chiefly by 21452 25091 4937 6519 6623 7012 6155
27689 27451 5758 7556 6378 7759 5693
11028 12188 2308 3041 2951 3888 2435
358 718 226 199 150 143 133
32. Restriction on imports of Used Cars
• In trade policy 2010-2011, the proposal to
allow up to 5 years old and used cars imported
in the country was dropped.
• Now the policy has been reversed and the
federal cabinet allowed the import of used
cars whose age does not exceed five years in
an attempt to check the rising prices of locally-
• There was a mixed reaction by the business
community on the trade policy 2009-12. Some
rejected it out rightly because according to them
continued severe energy shortage, high cost of
production, high cost of doing business, weak
infrastructure, inconsistent policies, lack of FDI,
limited scope of joint venture, low chances of
technology transfer deteriorating law and order
situation, and above all denial of easy and
smooth market access could play pivotal role to
achieve the targeted export competitiveness till