ISLAMABAD: President Islamabad Chamber of Commerce and Industry (ICCI) Zafar Bakhtawari has said only a few countries have made their position significant on economic horizon of the world and amongst them the most outstanding are Singapore and Dubai.
“These two countries are small but only because of their trade plans they have achieve esteem in the economic world. And the most important factor behind in achieving this status is that these countries have adopted easy customs rules or even no customs duty. If we have to put Pakistan on the road of prosperity, we should at least follow these simple rules regarding customs duty.”
He said that Pakistan enjoyed a unique geographical importance and it could become a transit trade corridor by facilitating regional countries through Gwadar and could become an economic giant by riding on its regional value like Singapore and Dubai.
“What is needed initially is to make busies friendly policies and reducing customs duties up to minimum except where is a need to protect our local industry.” The ICCI chairman pointed out that European Union (EU), a block of more than 25 countries, was enjoying a zero custom duty on the internal movements of goods within the zone. He said by adapting such measures European economy had shown an amazing development. He said the ASEAN block was also following these lines and 10 countries in this block had also developed a free market economy and were reaping rewards.
“Presently it is not possible for a single country to safeguard its economic interests alone. So there is a need that Pakistan should take initiative to make such regional block. It is unfortunate that SAARC and ECO (Economic Corporation Organisation) have failed due to lack of interest by the stakeholders.”
Bakhtawari said there was not any substantial change in the existing customs duty tariffs by the new government. On increase in sales tax which has an indirect effect on every business especially imports and exports, he said that sales tax was the tax which would replace the custom duty in future.
He said the increase in sales tax from 16% to 17% was not a big change considering the economic state of the country. He said the businesses were more affected by the worst energy crises, adjustment of Rs 500 billion circular debts.
“If one considers all the facts, 1% increase in the sales tax is justified and not a big change but at the same time. But the government should decrease GST gradually upto 10% by decreasing it one percent every year as soon as the economy becomes stable. This one percent increase will definitely affect everybody but current circumstances in Pakistan demand that everybody should pay his share to economy.”
Bakhtawari terming the budget business friendly said the tax relief on export processing zone from 5 years to 10 years would help grow the economy of Pakistan. “The government has announced to create an industrial zone and induction of Gwadar port in economic zone indicates that the idea of generating the economic corridors through Pakistan is materialising.”
He said the he believed that inclusion of Gwadar in the special economic zone, which would be tax free and would be considered tax holiday, be beneficial for Chinese investors in Pakistan. “China is interested in Gwadar for the reasons that it can make oil refinery there and can meet the future requirement of oil through Gwadar by rail tracks and road links, which has already been discussed by Chinese Pakistani premiers in last meeting.”
Answering a question about the major exports of Pakistan, Bakhtawari said the textile was considered as the top export of the country and Pakistan’s 60 percent export was based on textile industry. However he lamented the fact that Pakistan was still lagging far behind in access to international market because the customs duties are far heavy in Pakistan on textile as compared to Bangladesh and a country like Bangladesh, which has no cotton production, was exporting more textile than Pakistan.
