Prime Minister Adviser for Trade and Investment Abdul Razak Dawood has told a foreign media agency that tariffs on imports of raw materials demanded by the pharmaceutical, chemical, engineering and food industries will be reduced by up to 10%. The proposal will be included in the upcoming budget for fiscal year 2021-22, which will be presented on June 11th.
This measure is likely to reduce imports of finished products and boost domestic production, which may also stimulate exports.
Dawood said that the aim is to give Pakistan an equal footing with other countries in terms of trade tariffs.
Pakistan is currently going through economic revival as GDP growth, after falling to negative 0.5% last year, witnessed growth of 3.94% in the current financial year.
According to the report, the reduction in import taxes is a significant policy move in Pakistan, with more than 40% of tax revenue coming from customs duties imposed on incoming shipments.
Dawood said the current government is interested in increasing exports to stimulate economic growth and will provide long-term preferred export financing in the coming budget in addition to working on funding companies.
According to data released by the Ministry of Commerce, Pakistan’s exports grew 14% in the first 11 months (July-May) 2020-21, reaching $ 22.563 billion, compared to $ 19.801 billion in the same period 2019 -20.
In May 2021, exports rose 18.7% to $ 1.657 billion, compared to $ 1.396 billion in May 2020. However, exports in May fell 25% compared to April 2021.
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