Trade Policy Presentation

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STRATEGIC TRADE POLICYFRAMEWORK 2009 - 12

TRADE POLICY 2009


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Scheme of Presentation

Policy Statement

Trade Review

Challenges & Opportunities

Synopsis of Strategic Trade Policy Framework Proposed Trade Policy Initiatives

Over archingSector Specific

Trade Diplomacy

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In line with Manifesto of Pakistan Peoples Party,the Trade Policy Aims at

Growth with EquityGreater Opportunities for Gainful EmploymentSound Marco-economic Framework for TradeEnvironmentConcern with Poverty Eradication and Environmental

ProtectionInvesting in Human ResourceTargeting Poverty AlleviationPromoting Private Sector as Engine of Growth

Focus on Small Scale Sector Particularly Agriculture

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Policy Statement

The Ministry of Commerces endeavor is toprovide medium term policy framework withfocus on improving supply side to achievesustainable export growth.

The policy thrust would be to enhance quality,improve business processes through structural

transformation and transferring resources toachieve production and export of a moresophisticated and diversified range of products


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Imports and Exports 2008-09

Trade Review5


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Exports

Exports 07-08Exports 07-08 US$ 19.1 BillionUS$ 19.1 Billion

Export Target 08-09Export Target 08-09 US$ 22.1 BillionUS$ 22.1 Billion

Actual Exports 08-09Actual Exports 08-09 US$ 17.8 Billion*US$ 17.8 Billion*

Export GrowthExport Growth- 6.7%- 6.7%

* Provisional* Provisional

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WTO estimated a 9% shrinkage in

global trade

Pakistan is less hurt than competitors-Export growth in China declined by

24%, India by 31% and Bangladesh by

14%


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Exports Review

Exports were 6.7% less than 2007-08 due to Exogenous factors - demand shrinkage, financial crisis and

ensuing protectionist policies.Domestic Factors - Power shortages/outages, high financial

cost, bad law & order situation and competitiveness erosion

Traditional sectors like textile (- 9.5%), Leather (- 29%)declined, whereas Rice (8%), Engineering goods (26%),

Jewelry (35%) recorded growth in exports

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Exports Historical

Year Value(FOB $Billion)

Change(%age)

2000-01 9.2 -

2001-02 9.1 -0.72002-03 11.2 22.2

2003-04 12.3 10.3

2004-05 14.4 16.9

2005-06 16.5 14.32006-07 17.0 3.2

2007-08 19.2 13.2

2008-09 (P) 17.8 - 6.7

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Export of Major CommodityGroups (US$ Billion)

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Export Profile 2008-0910

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Export Destinations

Oceania is a geographical, often geopolitical, region consisting of numerous lands

mostly islands in the Pacific Ocean and vicinity. The term is used today in many

languages to denote a continent comprising Australia and proximate Pacific islands and

is one of eight terrestrial ecozones.


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Import Review

Imports were US$ 34.8 billion in 2008-09 ascompared to US$ 40 billion in 2007-08 , adecrease of 13 %

Lower imports are attributed mainly todemand shrinkage of items in Transport Group(-41%), and Textile Group (-29%) whereasimports of Petroleum decreased by 17% due

to drop in international prices of crude oil;imports of fertilizer were lower both in termsof value (39%) and quantity (45%)

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Imports HistoricalYear Value

(C&F US$Billion)

Change(%age)

2000-01 10.7

2001-02 10.3 - 3.62002-03 12.2 18.2

2003-04 15.6 27.6

2004-05 20.6 32.1

2005-06 28.6 38.8

2006-07 30.5 6.9

2007-08 40.0 30.9

2008-09(P) 34.8 - 13.0


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Groups

(US$ Billion)14


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Balance of Trade (US$ Billion)15


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Challenges1/3

External Factors: Economic downturn in our major markets:

Consumer confidence erosion in USA and its rippleeffects in EU;

Economic slowdown

Buyers perception of Pakistan as a supplierof low quality products and inability to deliverin bulk and in time.

Negative travel advisories.

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Challenges2/3

Domestic Factors

High cost of finance

Energy Crisis (Electricity and Gas)

Law and Order Lack of International Competitiveness

Investment declined to 19.7% of GDP asagainst 22.0% of last year

Large Scale Manufacturing growth declined by7.7% (Jul-Mar) as against increase of 4.8% in2007-08

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Challenges3/3

Indicator Ranking 2007-08

Ranking 2008-09

Overall Competitiveness 92 101

Infrastructure 72 85

Labour Market Efficiency 113 121

Financial MarketSophistication

65 71

Technological Readiness 89 100

Innovation &Sophistication Factors

78 85

Source: Global Competitiveness Report 2008-09, World EconomicForum

Sliding Down the Competitiveness Index

(Ranking among 131 countries)

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Opportunities

Favourable market access owing tobilateral trade agreements

Potential of doubling the value- additionof cotton of which Pakistan is the 4thlargest producer

Strong resource base in many sectors(food, building stones, gems & jewelry,

leather, rice, cement, light engineering) Growing Services Sectors


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Inference

Pakistan is fortunate to be less hurt by globalrecession and this has placed Pakistan in aposition to take rebound opportunity if :- Supportive & Targeted policies are adopted to help

export sector increase competitiveness & improveproduct sophistication

Supply side constraints like power shortages andhigh cost of finance are removed

Law & Order situation is improved

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Strategic Trade PolicyFramework 2009- 12

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Main Features

Three years strategic framework

Review mechanism

Well-defined business processes

Shift from Comparative Advantage toCompetitive Advantage

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Trade Policy Objectives1/2

People centric : Poverty alleviation and employmentgeneration through export led growth

1. Enhance the competitiveness of Pakistans exportsa) Increase the sophistication level of Pakistans exports by

increasing the technology component and value addition.b) Trade Facilitation

i. Process Improvementii. Aligning Tax Reform with Trade Facilitation with the aim to reduce

the cost of doing business

c) Address supply side constraints power shortage & highfinancial cost

d) Reduce anti-export bias

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Trade Policy Objectives2/2

2. Reducing Cost of Doing Business

3. Protection and promotion of SMEs

4. Focus on products with higher sophisticationpotential

5. Promote agricultural development throughexports

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Enable Pakistani exporting companies overcomethe negative effects of global demandcontraction

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Slide 94

F S f STPF 2009

T il

Serv ces


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Focus Sectors of STPF 2009- 12

Pharmaceuticals

Leather Gems & Jewelry Engineering Goods Surgical. Medical,

Dental, Beauty careinstruments

Agriculture & food Halal Products

Increasing overallcompetitiveness

Moving up thesophistication ladder

SMEs Cluster development

Creating supply anddemand side linkages

Improving DomesticCommerce in these sectors

Focus Sectors Policy Thrusts

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TextilesSupport to

initiatives inTextile Policy

Serv cesDevelop andimplement a

comprehensive

export plan


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Strategic Trade Policy Framework2009-12

Linking Trade Policy 2009-12 with otherdevelopment strategies by synergisingthe Functional Linkages between

trade and industry;trade and investment;trade and education;

trade and science & technology;trade and social protection policy

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Overarching GoalsofStrategic TradePolicy Framework 2009-12

Ensuring sustainable energy supply

Reducing cost of capital

Reforming domestic commerce

Promotion of Trade in Services

Consolidating gender sensitive tradepolicies

Greening of Exports Connecting Supply and demand better

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T d P li F l i


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Trade Policy FormulationProcess

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Meeting of the Advisory Council Short listing of Proposals received in response

to invitation or in the Council meeting Firming up the proposals in consultations with

major Chambers/ Associations and relevantministries Drafting of the Policy Presentation to the Prime Minister Submission to the Cabinet Issuance and approval


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TargetsIndicator Target 2012

Merchandise Exports (US$

Billion)

From 17.8 to 23.5

Competitiveness Ranking From 101 75

Engineering Sector Export-Share From 1.5% 5%

Value addition of Cotton From US$1000/bale to 1500/

bale

Expansion of Regional Trade From 17% 25%

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Proposed Initiatives

Strategic Trade PolicyFramework 2009-12

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Required to be Funded

Estimated Cost: Rs. 35.22 Billion

Period : 2009-12

Proposed Trade PolicyInitiatives


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New Initiatives

Addressing Supply-SideConstraints

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Fi i t R bl


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Financing at ReasonableMarkup Businesses need short to medium term certainty in the

interest rate for investment. Currently, there is nopolicy instrument provided by the government orprivate sector for providing finance at fixed interest

rates for a short to medium term It is proposed that a fund may be created to hedge

markup rate hikes. The fund shall be managed by anorganization (TDAP/ NIC) of the Ministry of Commerceand shall be financed from EISF.

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R li bilit f El t i it


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Reliability of ElectricitySupplyThe electricity shortages is an irrefutable fact and is

adversely affecting industrial productivity. While little canbe done, in short term, to increase the quantum of supplythere is possibility for introducing an element ofpredictability of power supply.

It is therefore proposed that Electricity DistributionCompanies (DISCOs) being bodies corporate should enterinto agreements with clusters of industries wherebyelectricity is supplied at mutually agreed times. Theagreements should have punitive and compensationlegally enforceable clauses; the compensation could be inthe form of electricity charges credit etc.

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I C f Vi iti


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Insurance Cover for VisitingBuyers Purchasers, inspectors and sourcing agents of overseas

buyers are reluctant to travel to Pakistan and theexporters have to meet them in other countries. Thisincreases cost of doing business. It has been learnt thatapart from travel advisories that stop the

purchasers/importers from coming to Pakistan but also thefact that the insurance companies refuse to cover theperiod of stay in Pakistan on usual rate of premium.

A scheme may be launched for picking up the full coverfor stay in Pakistan for valid insurance policy of visitingbuyers/ buyers representatives.

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Existing Initiatives to be Continued

Trade Facilitation

F ilit ti P i


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Facilitating Presence inInternational MarketsTo encourage local firms to have international presence

and thereby increase the profitability followinginitiatives were taken in previous trade policies:

Support for Opening Exporters Offices Abroad

Support for Opening Retail Sales Outlets Abroad It is proposed that the above initiatives may be allowed

to be continued throughout the period of STPF 2009-12

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Warehousing Facility

To make inroads into non-traditional marketsand / or to introduce non-traditional products intraditional markets a warehouse scheme waslaunched and a warehouse was established in

Kenya. The changing patterns of trade requiredirect to store deliveries and thereby need ofwarehouse even in traditional markets.

It is proposed that the warehousing scheme maybe continued and its scope expanded to include

traditional markets and traditional products.

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Support for Compliance


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Support for ComplianceCertification In the previous three years government announced

50% subsidy for various quality, environmental andsocial certifications. To encourage further, thesubsidy was progressively increased to 100% of thecost of certification when a manufacturing unitsgets four of the specified certifications*.

It is proposed that the initiatives may be continuedin the Trade Policy 2009 and list of certificationsmay be expanded by TDAP in consultation with theIndustry.

* (i) ISO 9000, (ii) ISO 140001, (iii) OHSAS 18001, (iv) SA 8000, (v) WRAP, (vi)EKOTEX, (vii) BSCI, (viii) BRC

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New Initiatives

Sector Specific

C ti I l d F i ht


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Compensating Inland FreightCharges

Extra cost on inland transportation erodes exportcompetitiveness of a range of developmentalproducts.

It is proposed that a scheme may be launched to

compensate inland freight cost to exporters ofcement, light engineering, leather garments,furniture, soda ash, hydrogen peroxide, sanitarywares including tiles, finished marble/ granite/onyx products. The scheme may be funded from

Export Investment Support Fund

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Technology Skill and Management


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All final use products do require continuousresearch and development for enhancingcompetitiveness either by technology up-gradation, skill development or by improved

management systems. A fund dedicated tosupport these activities is required.

It is proposed that a Technology, Skill andManagement Up-gradation fund of Rs. 3 billion

may be established.

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Technology, Skill and ManagementUp-gradation Fund for ValueAdded Products

ran romo on uppor or


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ran romo on uppor orSurgical Instruments, Sportsgoods & CutleryThe manufacturing in these sectors is largely done

under the brands of foreign companies, and thatresult in lower prices for manufacturers in thesesectors.

It is proposed that surgical instruments*, sportsgoods & cutlery sector may be granted 25%subsidy on brand promotional expenses likeadvertisement in recognized trade journals,

certification cost.* Term Surgical includes surgical, medical, dental,

veterinary, beauty care (manicure/ pedicure etc.) andlike instruments

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Product Development and


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Product Development andMarketing Fund for LightEngineering Engineering sector is dynamic and resilient but

it is fragmented. This sector has shownpromising growth during 2008-09 with anexport growth of 32.1%.

In order to increase the sophistication level &realize true potential of this sector, it isproposed that a special fund of Rs 2.5 Billionmay be created for product development &marketing for light engineering sector.

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n anc ng op s ca on n


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n anc ng op s ca on nSurgical Instruments Centerof Excellence Shortage of well-trained skilled manpower is

impeding growth of surgical instrumentsmanufacturing industry.

It is proposed that Ministry of Industries andProduction may establish a center ofexcellence for catering to the training,designing, research & development needs of

surgical instrument*s sector at Sialkot *Term Surgical includes surgical, medical, dental,

veterinary, beauty care (manicure/ pedicure etc.) andlike instruments

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Enhancing Sophistication in


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Enhancing Sophistication inLeather Apparel

Leather apparel industry needs to adapt to changingtrends for which they need expert input for improvingquality and efficiency.

It is proposed that use of EISF may be allowed for:- Providing on the floor expert advisory / consultancy services

to leather apparel manufacturers cum exporters.Matching grant to establish design studios or design centers

in their factories. Establishing R&D Centers in Karachi and Sialkot by PLGMEA

for providing Research & Development support to LeatherGarments & Leather Goods Exporters.

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Freight Subsidy on Export of


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Freight Subsidy on Export ofLive Sea Food

Live sea food fetch very high prices in internationalmarkets as compared to frozen products, minimumprice ratio is 1.10. In fact, maximum value addition isthrough export of live sea food. This product offersimmense potential in export markets.

It is, therefore, proposed to grant 25% freight subsidy iflive seafood products are exported by air. This will alsocompensate exporters to overcome losses incurred dueto mortality.

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Support on Export of


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Support on Export ofProcessed Food

Raw and semi-processed agriculturalproduced being currently exported can gethigher values if exported as processed food.However, TBTs on processed food require

compliance to more sophisticated standardsand thereby higher cost of production

It is proposed that processed food exportsmay be supported initially by reimbursingR&D cost @ 6% of the exports; the quantum &mode of support to be adjusted after adetailed study but not later than May 2010.

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Introduction of PAKGAP


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Introduction of PAKGAPStandard Good Agricultural practices are essential to ensure

food safety both locally and in export markets andthereby a better acceptability; our agricultural sectoris lacking recognized agricultural practices standards.

It is proposed that PAKGAP (Pakistan Good Agricultural

Practices) standards initially for five majorhorticultural exports (citrus, mango, date, potato andonion) may be worked out by MoST and implementedby MINFA in collaboration with PHDEB.

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Conversion of PHDEB into a


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Conversion of PHDEB into acompany

Pakistan Horticulture Development & Export Boardis a EDF funded project of the Ministry ofCommerce. Due to its undefined status it canneither seek international assistance which is

otherwise available nor contribute fully to thedevelopment of the sector. It has therefore beingchanged into a corporate body.

It is proposed that, on incorporation, O&M

expenses of PHDEB may be funded for a period ofthree years.

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mprov ng upp y a n o


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mprov ng upp y a n oLeather Sector Exports Flaying Machines It is estimated that a minimum of 25% hides

and skins are rendered useless from butchercuts. There is an imminent need to introduceflaying machines in abattoirs but local

governments have limited resources to installand run flaying machines. It is therefore proposed that EISF may be used

for providing matching grants to districtgovernments for installing flaying machines.

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mprov ng upp y a n o


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mprov ng upp y a n oLeather Sector Exports Finished Leather Finished leather is one of the major export products & an

intermediate product in which substantial value addition canbe achieved by adopting modern production processes andcreating trendy finishes. There is a need to encouragetanneries to upgrade production and designing facilities andto facilitate them for complying with international standards.

It is therefore proposed that EISF may be allowed to be usedfor:- Sharing 25% financial cost of setting up of design centers and labs

in the individual tanneries.To provide matching grant for setting up of effluent treatment

plants in individual tanneries.

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Services Export


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Services ExportDevelopment Fund Services sector has immense potential for earning

foreign exchange however high pre-project costs area deterrent to its expansion. Support to ServicesSector in tendering process and preparingprefeasibility / feasibility studies shall beinstrumental in helping the sector to achieve its

potential. It is proposed that a Services Export Development

Fund may be established to provide assistance in theform of reimbursable grants, to Pakistan serviceexporters for Tendering or negotiating for

international projects and for conducting pre-feasibility or feasibility studies for internationalprojects.

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Halal Products Cost sharing


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Halal Products - Cost sharingof Certification Halal Products (Food & non-food) is an over trillion

dollar market. Pakistan despite being a Muslimcountry is being left behind and one of the majorreason is lack of recognized halal standards. MoST

is charged with working out the standards andsetting up a Halal Certification Board.

It is proposed that till the time the HalalCertification Board is setup, the government may

subsidize the cost of certification by internationallyrecognized bodies by 50%.

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Compliance with Safety


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Compliance with SafetyStandards

Safety Standards Certification byUnderwriters Laboratories (UL)increases the level of acceptability of

manufactured products particularlydomestic electrical appliances ininternational markets.

It is proposed that 50% cost of ULcertification may be subsidized.

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Continuing Initiatives

Sector Specific

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Cluster Development

It was decided in last years Trade Policy that TradeDevelopment Authority of Pakistan(TDAP) will establish11 new clusters such as surgical/sportswear/gloves/leather etc to facilitate small units.

Since export clusters are essential for developmentpromotion of non-traditional products, it is proposed tocontinue with this initiative in current trade policy togain maximum benefit from the establishment of theseclusters.

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Support on Export of


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Support on Export ofMotorcycles Export of Motorcycles was facilitated

through R&D support of US$ 50 (RupeeEquivalent)/ Unit. However the

disbursement was started in end of FY2008-09.

It is proposed that the support may becontinued till June 2010.

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Pharmaceutical

Pharmaceutical sector was given followingincentives in previous years: Support for hiring medical representatives abroadSupport for registration of pharmaceutical products

abroadSupport for bioequivalence certification

The sector has responded well It is proposed that the above initiatives may be

allowed to be continued throughout the periodof STPF 2009-12

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Matching Grant for Paddy


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Matching Grant for PaddyHarvesters and Paddy Dryers

A large number of export consignments of rice arebeing rejected due to aflatoxin infestation; acondition attributed to high moisture contents ofpaddy.

The possibilities of aflatoxin infestation can beminimized by introducing paddy harvesters andpaddy dryers which the farmers are reluctant toprocure due to high cost.

It is proposed that matching grants may be given tofarmers / rice millers for purchase of paddyharvesters and paddy dryers.

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Zero Rating of Exports and


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Zero Rating of Exports andAdhoc Relief @1% Exporters are forced to export indirect taxes, estimated to be

around 9% of the cost of production. Trade Policy 2008 proposed astudy to calculate the burden of these taxes and pending that togive interim relief to fourteen sectors in shape of additional dutydrawback @1% of export value. Though the proposal was approvedby the Cabinet, FBR did not allow additional duty drawback.

It is proposed that the exports may be completely zero rated and tillsuch time the decision to give additional duty drawback to specifiedsectors may be implemented as an interim relief measure in TradePolicy 2009; the sectors are tents & canvas, electric machinery,carpets, rugs and mats, sports goods, footwear, surgical/ medical/

veterinary/ beauty care instruments, cutlery, onyx products, electricfans, furniture, autoparts, handicrafts, jewelry and pharmaceuticals

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Assistance to Horticulture


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Assistance to HorticultureSector It was decided in trade policy 2008-09

that a farm to port cool chain will beestablished, till completion of cool chain,

support for cool chain and cold storagesfor horticulture will be given at 8% or50% of the markup, which ever is lower.

It is proposed that this facility for

horticulture may be continued.

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New Initiatives

Miscellaneous

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i f d


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Greening of Industry

Energy efficiency of the boilers being used byour industries can be enhanced by 30%thereby reduce the cost of production. Serviceproviders for conversion of boilers are available

but are reluctant to come to Pakistan.To encourage conversion of boilers for

increasing efficiency the government shouldunderwrite the agreement between service

providers and the industry.

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Process Re-engineering

Trade Policy Initiatives

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Reducing Cost of DoingBusiness

I t f U d D illi Ri


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Import of Used Drilling Rigs

Oil and gas and petroleum sector companies areallowed import of second hand plant and machineryequipment required for their project in Pakistan subjectto pre-shipment certification to the effect that suchplant, machinery and equipment are in good working

condition and are not older than 10 years.

Since drilling rigs usually have a useful life of around 20years it is proposed that the age limit for them may beenhanced to 20 years subject to PSI certification.

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Import of Specialized


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Import of SpecializedMachineryThere are various restrictions on import of specialized

machinery and transport equipment e.g. Concrete TransitLorries, Concrete Pumps, Crain Lorries, ConcretePlacingTrucks, Dump Trucks, Waste Disposal Trucks,cement bulkers and Prime Movers. These conditionsinclude age restrictions, actual use etc.

It is therefore proposed that Import of specializedmachinery/ transport equipment by actual users(construction companies etc.) in used condition providedthey fulfill emission standards and have sufficientproductive life irrespective of the age.

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T d i f M hi


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Trade-in of Machinery

There is a possibility for Industrial Users totrade-in new, refurbished or up-gradedmachinery with their obsolete machinery.Current import and export regimes do notprovide for trade-ins whereas if allowed it could

reduce the expenditure on BMR. It is therefore proposed that Industrial

importers be allowed to import new,refurbished and upgraded machinery on thebasis of trade-in with their old, obsolete

machinery. Likewise export of their old/obsoletemachinery for trade in with new, refurbished orupgraded machinery may also be allowed.

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Advance Remittance for


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Advance Remittance forExpeditious Imports

State Bank of Pakistan has discontinued thefacility to remit US$ 10,000 per invoice, asadvance payment, for import of spare parts,consumables/ raw materials etc. The

discontinuation of the facility has increased thecost and time to effect urgent imports. It is proposed that facility to remit US$ 10,000

per invoice, as advance payment, for import ofspare parts, consumables/ raw materials etc

may be restored by State Bank of Pakistan.

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Waiver of Size Restrictions on Import of


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Secondary Quality Iron & Steel Plates/Sheets/ Coils

Import of secondary quality iron and steelsheets/plates / coils is allowed provided the sizesare over 48" (length) x 20 (width). The sizerestriction is irrational and difficult to implement.

The industrial users face difficulties in gettingclearance of unsorted scrap which adds to cost ofdoing business.

It is proposed that minimum size restrictions onimport of secondary quality iron and steel

sheets/plates / coils may be waived off.

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Sector Specific

Reducing Cost of DoingBusiness

e uc ng os o o ngB i G & J l


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g gBusiness Gems & JewelrySectorTo promote Gems and Jewelry sector, the Cabinet

in Trade Policy 2008, approved waiver of customsduties and sales tax on import of Gold, Diamonds,Silver, Platinum ,Palladium and precious stones.

The waiver was not extended to pearls and other

synthetic or reconstructed precious or semiprecious stones though these are increasinglybeing used in jewelry production. Further FBRdidnt comprehensively implement the decision.

It is proposed to exempt natural pearls and othersynthetic or reconstructed precious or semi

precious stones from customs duty and sales tax.Implementation of Cabinet decision may beexpedited.

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Pharmaceuticals Exports -


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Pharmaceuticals Exports Facilitation

Marketing of pharmaceutical productsinvolve number of complexities in theinternational territory including need for

extensive sampling at product launchingstage.

It is therefore proposed that limit forphysicians' samples may be enhanced to

20% (current limit 10%) at the time oflaunch with first shipment

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Special EOU Status to


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Spec a OU S a us oEngineering Units

Currently, units that export 100% of their production enjoythe status of Export Oriented Units and the benefitsthereof. Since, engineering industry, particularly automotive parts manufacturing industry has vast exportpotential but cannot export all of its production in initialstages it needs special treatment.

It is proposed that engineering units may be allowed EOUfacility on export of 50% of their production for the firstthree years. After that engineering units should be allowedthis facility on export of 80% of their production.

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Export Related

Export of Edible Oil in Bulk


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Export of Edible Oil in Bulk

At present export of edible oil fromPakistan is allowed in retail packs. Thepermission for export in Bulk should beallowed. There have been export demandsfor domestic edible oils like sun flower,canola and cotton seed.

It is therefore proposed that export in bulk

of these oils (sun flower, canola and cottonseed) may be allowed.

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Export of Pulses


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Export of Pulses

Currently exports of all types of pulses is banneddue to domestic supply reasons. There is a growinginternational demand for this item. Opportunitiesexist for exporting pulses obtained on processing

of imported inputs. It is proposed that exports of pulses obtained on

processing of imported inputs may be allowedsubject to necessary safeguards against export ofindigenous pulses. Regulatory duty on suchexports may be waived off.

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Regulatory

Import Related

Controlling Import of Poppy


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g p ppySeeds Presently there is no restriction on import of

Poppy seeds as far as the origin is concerned.Single convention binds the signatories toimport poppy seeds only from the countries

where it is legally produced. In view of the international commitments it is

proposed that source of import of opium poppyseeds may be restricted to the countries where

it is legally produced.

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Controlling Import of


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g pScrap/Waste Plastics

Presently import of waste, parings and scrap ofpolyethylene and polypropylene is restricted toindustrial consumers while import of otherplastics is allowed on commercial basis.

To regulate import of such scrap, it is proposedto restrict import of all types of plastic scrap toindustrial consumers only and strictly inaccordance with the Provisions of the Basel

Convention.

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Import of Used Computer


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p pComponents

At present old and used computers andperipherals thereof are freely importable butthe import of used components (RAM, Casing,Motherboard, Processors etc) is banned.

Thereby depriving the low income strata ofcomputer use.

In order to encourage use of computers by lowincome segment of population, it is proposed

that import of old & used computercomponents may be allowed.

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Restricting Import of Used CRT


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g pMonitors

Second hand Cathode Ray Tubes (CRT)monitors are being imported and used astelevisions thereby posing a threat to

local television industry; excessiveimport of first worlds e-waste is also athreat to the environment.

It is therefore proposed that import of

CRT monitors may be disallowed unlessimported alongwith used computers.

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Protecting Local Vaccine


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gProducers Local manufacturing of vaccines is of strategic

importance and now local companies have startedventuring into this high tech segment. Unhinderedimport of vaccines is a discouraging factor.

It is proposed that to encourage localmanufacturing, import of vaccines may be allowedonly from World Health Organization (WHO)approved plants.

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Import Facilitation

Trade Policy Initiatives

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Import of Donated


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pAmbulances Only such used ambulances (not more than 15

years old) that are donated by "reputableorganizations" are allowed for imports by charitableorganizations/ trusts/ hospitals.

It is proposed that import of used ambulances thatfulfill certifiable standards and have minimum 10years of useful life may be allowed when donatedby any organization / individual to charitable ornon-profit organizations, trusts or hospitals.

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Disabled Persons Import of


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Motorized Wheel Chairs

Secondhand / used motorized wheel chairsare presently importable only by charitableinstitutions and hospitals whereas actualusers cannot do so.

To facilitate disabled persons it is proposedthat import of one Secondhand / used dutyfree motorized wheel chair may be allowed

to actual user.

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Disabled Persons - Import of


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Duty Free Cars

Disabled persons are allowed waiver of import dutywhich is in excess of 10% on CKD kits that areimported for assembling of car for them. Restrictingdisabled persons to use locally assembled cars limitsthe choice to few makes; there have been persistentcomplaints of non-availability of customized vehicles

among the local makes. Previously duty free import ofcustomized cars by disabled persons was allowed.To facilitate disabled persons to actively participate in

economic activity, the facility to import duty freecustomized cars, not above 1350cc of engine capacity,may be allowed.

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Liberalization

Import Related

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Transfer of Residence (TR)


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Rules - Amendment

In case a passenger who brings/importsvehicle under TR scheme dies before theissuance of TR, there is no provision inImport Policy Order for release of suchvehicle.

It is proposed that vehicle imported by aoverseas Pakistani, under TR rules, may be

released to legal heir(s) in case of his / herdeath.

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Pakistan's exports ranked by


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Pakistan s exports ranked bysophistication

and share in total exports. All of themRCA>1

SITC R2, Aggregate 4

Commdity Sophistication 1985 1990 1995 2000 2005 2006

Medical Instruments and appliances, nes 20814.00 1.23 0.95 0.89 0.88 0.97 1.00

other sporting goods and fairground amusements, etc 15712.00 1.22 1.87 2.00 1.85 1.76 1.94

Cotton fabrics, woven, bleached, dyed, etc, or otherwise finished 11214.00 3.46 4.11 6.02 3.61 4.78 4.48

Leather of other bovine cattle and equine leather 10168.00 2.21 2.04 1.31 0.92 1.17 1.14

Clothing accessories, knitted or crocheted, nes 9429.00 0.23 0.36 0.73 0.90 1.65 1.95

Fabrics, woven, less 85% of discontinuous synthetic fibres 8683.00 0.10 2.49 3.09 4.00 3.48 3.17

Womens, girls, infants outerwear, textile, not knitted or crocheted; 8585.00 1.24 2.59 1.90 2.44 2.59 2.77

other outer garments of textile fabrics, not knitted, crocheted

Other made-up articles of textile materials, nes 8359.00 0.89 0.93 1.60 2.86 2.79 2.72Outerwear knitted or crocheted, not elastic nor rubberized; jerseys, 8199.00 0.16 1.16 1.65 3.79 3.23 3.05

pullovers, slip-overs, cardigans, etc

Articles of apparel, clothing accessories of leather 8176.00 2.11 4.49 4.80 4.61 2.96 2.73

Outerwear knitted or crocheted, not elastic nor rubberized; other, 8119.00 0.28 0.96 1.63 1.70 2.18 2.17

clothin accessories non-elastic knitted or crocheted

Linens and furnishing articles of textile, not knitted or crocheted 7,345 3.66 5.45 5.94 9.30 12.63 13.38

Under-garments, knitted or crocheted; of cotton, not elastic nor 7,122 1.00 2.27 4.27 3.62 3.55 3.87

rubberizedMen's and boys' outerwear, textile fabrics not knitted or crocheted; 6,798 0.28 0.64 1.25 2.75 2.96 3.15

trousers, breeches and the like

Cotton yarn 5,728 10.32 16.91 18.91 13.21 10.14 10.53

Carpets, carpeting and rugs, knotted 5,309 4.57 3.86 1.82 2.33 1.93 1.74

Rice, semi-milled or wholly milled 5,060 8.63 4.64 5.55 5.71 5.82 6.46

Cotton fabrics, woven, unbleached, not mercerized 4,578 5.07 5.15 6.88 6.16 5.15 5.20

Sub-total (%) 46.70 60.90 70.20 70.60 69.70 71.50

Sophistication at the country level 7231.00 7693.00 8268.00 8362.00 8833.00 8,72a

Slide 24

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* Other Manufactures US$


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$

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Documents

Trade Policy Presentation