In 2013, the grant of Generalised System of Preferences (GSP) Plus status to Pakistan by the European Union was seen as the big achievement of Nawaz Sharif after he assumed powers as the prime minister. However, the country could not avail full benefits of the duty free access and the scheme is reportedly ending this year. At the time, 406 members of the European Parliament had supported Pakistan, allowing 20 percent of Pakistani exports to enter the EU market at zero tariff and 70 percent at preferential rates. No doubt the Pakistani exporters had achieved laurels in the world trade in the past and the award of the GSP Plus status was a show of confidence of the international community in the standard and quality of the Pakistani products. However, four years later, the move apparently ended in fiasco. Now it is time for the government to determine the causes of its failure as to why the business community had not been able to take full benefits of the scheme. The fate of other bilateral trade agreements between Pakistan and the European Union also hangs in balance.
According to the advice of the selected experts, which met the other day, a joint effort by all the stakeholders is required to ascertain and resolve the problems being faced by the exporters. There is a need to start concerted efforts to determine key factors which are required to push up growth and avail the benefits of Small and Medium Enterprises to create export surplus. The first problem faced by the exporters is their inability to diversify their products and keep up international standards by using modern techniques and machines. The shortage of electricity is still haunting the industry and there is a lack of coordination between the official machinery and the business community. Mistrust between the two sides prevails and no effort has been made to fill the gap. The business community complains the government is in no a mood to consult them during the formulation of relevant policies. Alleged corruption in the taxation system is no more a secret and revision of tax laws is need of the hour.
The businessmen want early release of duty drawback claims and effective policy initiatives to increase the export volume. The prime minister is currently on a visit to attend the moot of D-8 Organization for Economic Cooperation in Turkey. It is hoped the officials will also discuss the issue of the renewal of the GSP status after he returns to the country and would take effective measures to get benefit from the scheme.
