KARACHI, 24 July 2004 — Pakistan is setting an overly ambitious export target for the current fiscal year which could have negative repercussions for the economy, analysts and exporters warned yesterday.
Commerce Minister Humayun Akhtar late Thursday laid out the government’s trade targets for the fiscal year to June 2005. Exports were set at $13.7 billion and imports at $16.7 billion.
“The export target is over-ambitious,” Shahid Hasan Siddiqui, who heads the Karachi-based Research Institute of Islamic Banking and Finance, told AFP.
Exports in the past fiscal year reached a record $12.3 billion, with imports at $15.5 billion.
A leading exporter noted that the plan to abolish global textile quotas from next January would have a negative effect on Pakistan, which relies heavily on exports of bed linen and other textiles.
Last year textiles accounted for 68 percent of the country’s total exports.
“We are already facing anti-dumping duties from the European Union and things will get worse when they impose a 12 percent duty on all textile goods with effect from Jan. 1,” said leading bed linen exporter Shabbir Ahmed. “It would be hard to meet the new export target (under such an) emerging scenario,” he said.
The EU imports over 40 percent of Pakistan’s textile goods.
Another analyst warned that achieving the government’s economic growth target of 6.6 percent for the current fiscal year would require a pickup in import activity.
Without a corresponding rise in exports, the country’s trade deficit would balloon, Masood Qazi, professor of public finance at the Institute of Business Administration (IBA), said.
“The growth (target) necessitates an increase in imports, whereas we do not see any significant sign of export growth. Thus the increased trade deficit will hurt the current account,” he said.
In the past fiscal year the Pakistani economy grew 6.4 percent.
