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Government will continue to provide all necessary incentives to private sector:PM

04 May, 2007

ISLAMABAD: Prime Minister Shaukat Aziz chaired a high level meeting Thursday to consider the various factors responsible for the slower than expected growth in the country's exports in the first nine months of the current financial year.

The Ministry of Commerce made a detailed presentation analyzing the factors underlying the export performance during the current financial year.

It was pointed out that to achieve the desired level of export growth it was important to improve the productivity level, ensure quality and concentrate on value added products. The Government has over the years adopted a systematic approach to support the efforts of the private sector for increasing exports.

In this regard the Government has provided a number of fiscal incentives and has also carried out reforms designed to reduce the cost of doing business. Several other fiscal incentives were also discussed and will be considered in the upcoming budget.

The Prime Minister observed that the need now was for all stakeholders including government, industry, labour and the trading community to play their role in taking full advantage of opportunities available in export markets.

He emphasized the need for skill development programmes on war footing in order to solve the problem of low productivity. Such skill development programmes were already being undertaken by the Government but needed to be intensified in partnership with the private sector.

The meeting was informed that from the reports of reputed international consultants it emerged that the incentives regime available to the Pakistani exporters was at par with and in some cases even better than regional competitors.

He said in terms of various costs like labour wages, electricity and gas prices, POL prices, container cost and price of cotton, Pakistan is cheaper compared to most countries of the region.

Similarly in industrial tariffs and long term normal financing for exports Pakistan is among the cheapest in the region. Pakistan, he said, is the only country that provides R&D at the time of export of textile products.

The Prime Minister said that the government will continue to provide all necessary incentives to the private sector to help and encourage it to enhance the export of value added products.

The Prime Minister said there is an urgent need to find new markets and diversify exports as the regime of quotas has disappeared with globalization.

The Prime Minister said that the signing of a FTA with China is landmark development which needs to be leveraged by the private sector as it provides a huge market geographically contiguous to the country. He said that government is making efforts to concluded FTAs with the US and the European Union.

While discussing the textile sector the Prime Minister underlined the need to identify niches in which Pakistan had a competitive advantage and to concentrate efforts and investments in those areas. The Government would of course continue to support the private sector principally by facilitating greater market access through bilateral agreements and preferential trading arrangements with other countries.

He said the private sector needs consolidation through mergers to achieve the scale and size necessary for quantum leap in exports.

The meeting was attended among others by Minister for Commerce, Mr. Humayun Akhtar Khan, Minister for Industries and Production Mr. Jahangir Khan Tareen, Minister for Textile Industry Mr. Mushtaq Ali Cheema, Advisor to the Prime Minister on Finance Dr. Salman Shah, Deputy Chairman, Planning Commission Dr. M. Akram Sheikh, Governor State Bank of Pakistan Dr. Shamshad Akhtar, Chief Executive Officer TDAP Mr. Tariq Akram, Chairman CBR and senior officials.

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