ISLAMABAD: The Federal Board of Revenue (FBR) has suggested the quarters concerned to review the existing trade policy with China.
According to the FBR, Pak-China trade data reveals that terms of trade with China so far have not been in favor of Pakistan. The trade balance during the last ten years has worsened from Rs -95 billion to Rs -826 billion.
The quarters concerned need to review the existing policy and situation to improve the balance of trade in favor of Pakistan.
According to FBR, another impact of FTA has been seen on the rapidly changing ratios of dutiable and duty free imports. The ratio of dutiable imports has gone down from 88% in 2004-05 to 56% in 2016-17 and ratio of duty free imports has gone up from 12% to 44%. The increasing volume of free trade is the natural outcome of the FTA.
The overall higher growth in imports would offset the customs revenue loss and the same has been proved from the import data of last few years.
However, negative trade balance is a point of concern for Pakistan. There is a wide gap between country’s imports and exports. FBR has proposed that to maximize the benefits of FTA and CPEC, create environment to attract more investment from China in industrial and agriculture sectors.
