By Mansoor Ahmad
LAHORE: Pakistan has been losing its share in global markets which experts blame on the limited range of products and dependence on a small number of markets resulting in a constant decline in the country’s share in global trade.
They say India has increased its share in global trade after diversification of export products from 0.6 per cent in 1999 to 1.45 per cent in 2008 while Pakistan’s share has shrunk from 0.21 per cent to 0.13 per cent in the same period.
They point out that economic planners set a number of targets without providing any justification. For instance, as the economy is in recession and faces acute energy and power shortage, the country has fixed a six per cent higher target for exports in 2009-10. Contrary to that, India with a growing economy has kept the export target for 2009-10 at the previous year’s level of $168 billion in view of global recession.
Engineering entrepreneur Almas Hyder said the planners, if wanted to make a mark in global trade, would have to look beyond textiles and beyond markets of the US and the European Union. He doubted the free trade agreement-driven market access, pursued by successive governments, would generate sufficient trade, saying Pakistan’s gains would be minimal with smaller economies and nothing with larger ones.
“It will be futile to seek access to existing markets. Pakistan has preferential access for many goods which it can produce but is not producing due to absence of government’s facilitation,” he said.
Auto parts’ vendor Syed Nabeel Hashmi said every nation, which started with textiles, finally graduated in production of hi-tech products, making its mark in global markets. Citing examples of Japan, China and India, he said textiles in each of these countries at one time were major export earners. However, Indian exports of software, pharmaceuticals, auto parts and gems and jewellery have now made it an emerging player in global markets.
China and India, he added, still commanded huge markets in textile but the scope of textile trade was limited as it accounted for only six per cent of total global trade. “These countries have excelled while planning beyond textiles,” he said.
The abysmal export performance of Pakistan had profound implications for the economy because “sustained high growth rates are difficult to achieve without rapidly increasing exports.” The rise in exports should be double than gross domestic product growth, he suggested.
Businessman Farooq Iftikhar pointed out that 75 per cent of Pakistan’s exports came from only three sectors which were textile, leather and rice while almost half of its exports went to the US and EU. “We cannot expect to make a leap jump in exports with these limited markets and product range.”
Software developer Saad bin Tahir said the domestic computer industry having well-educated English-speaking workforce offered many opportunities for companies in the European Union and the United States. If properly nourished, he said, the IT sector could match the Indians in a decade and for that the government would have to provide first-class infrastructure and facilitate software exporters by providing incentives.
He said software and IT services exports would pick up gradually and steadily on the strength of available human resource.
Lahore Stock Exchange’s former chairman Group Captain (Retd) Naeem A Khan said the economic planners had been wasting their energies on trade with India which was practically impossible. “We neglected other neighbours like China, Iran, Bangladesh and Sri Lanka.”