PAKISTAN UNVEILS NEW TRADE POLICY TO BOOST EXPORTS
  Pakistani government allowed freer
  cotton and rice export in a three-year new trade policy aimed
  at narrowing the country's yawning trade gap.
      Commerce and Planning Minister Mahbubul Haq said in a
  televised speech the government had also decided to allow
  duty-free import of cotton yarn to make the textile industry
  more competitive, and to link bulk tea imports to the export of
  Pakistani products.
     
      Cotton and rice are Pakistan's main exports, which have
  been handled exclusively by state corporations since early
  1970s.
      But Haq said now the private sector would also export
  cotton and rice along with the corporations, which meets a
  long-standing demand of the local traders.
      The duty-free import of cotton yarn has been allowed to
  bring down prices and help the local ancillary industries
  compete effectively in the world market, he said.
     
      Haq said the new policy, effective from the fiscal year
  1987/88 beginning on July 1, would be for three years but
  reviewed every year.
      It was a departure from the previous practice of announcing
  trade policies for a single fiscal year, and Haq said it would
  enable the businessmen to plan their market strategies over a
  longer period.
      He said an export credit of 250 mln dlrs had been provided
  for the export of engineering goods to selected third world
  countries on soft credit terms.
     
      Pakistan's 1986/87 exports at 3.6 billion dlrs, 18.2 per
  cent more than in the previous year, and imports at 5.23
  billion dlrs compared to 5.63 billion dlrs in 1985/86.
      He said the government policy was to rationalise and
  streamline import controls.
      "It has been observed that due to restrictions on imports,
  specially on raw materials and intermediate goods, local
  industry has been suffering for want of necessary inputs," he
  said. "Prices have been on the increase and quality of goods
  produced has been low. This restrictive policy also gave rise
  to smuggling and hampering of exports."
     
      He said that to correct this situation, 136 items had freed
  from import restrictions.
      Previously, Pakistan has met its trade gap largely from
  remittances from its nationals working abroad, mainly in the
  Gulf. However, the remittances have begun to fall after the
  drop in oil prices in recent years leading to the spectre of a
  balance of payments crisis for Pakistan.
  

