$21.5 billion export target for 2010-11 likely

[Hyde]

$21.5 billion export target for 2010-11 likely​

MUSHTAQ GHUMMAN
ISLAMABAD (July 23 2010): Commerce Ministry is expected to set $21.5 billion export target in Trade Policy 2010-11, to be announced shortly, well-informed sources told Business Recorder. Before the federal cabinet's approval, the Commerce Ministry will give a presentation to Prime Minister Syed Yousuf Raza Gilani on the fine-tuned proposals which have been submitted by various stakeholders.

Country's exports fetched $19.382 billion in 2009-10 as compared to $17.688 billion the year before, showing an increase of 9.58 percent despite an economic slowdown across the world. The sources said a number of measures are being proposed in the Trade Policy to encourage exporters who were deprived of announced incentives in Trade Policy 2009-10.

Commerce Ministry is accusing Finance Ministry of not providing the earmarked funds for the Strategic Trade Policy Framework (STPF) which were critical to implement the plan in letter and spirit. "We have not been paid even a single rupee by the Finance Ministry to implement the policy despite hectic efforts," claimed one of the top officials of Commerce Ministry.

The sources said that the then Finance Minister, Shaukat Tarin, had agreed to release Rs 2.5 billion to the Commerce Ministry to implement the initiatives launched in the STPF, but nothing had been released to date. Last year, a Commerce Ministry announced STPF with a hope that it would enable country's industry to compete effectively through a set of integrated and holistic policy measures in the international market.

According to sources, the government will impose a ban on the open import of cigarette making paper by inserting a new clause in the import policy order, with the objective of discouraging misuse by either packing cigarettes produced by unauthorised manufacturers or packing substandard products under the garb of international brands.

The sources revealed that battery manufacturers in the country import exhausted batteries of automobiles to retrieve lead which forms 55% of a battery. This lead is re-used in the manufacturing of batteries after a re-melting process. Plastic container of waste batteries is also recycled which forms 15% of the battery. The remaining 30% is total waste, the disposal of which requires treatment to safeguard the biotech environment.

The following regulation is therefore being considered in the Trade Policy: "Importable by industrial consumers only for their own use subject to the condition that he shall furnish to customs authorities". A certificate from Environmental Protection Agency (EPA) is also being made mandatory which will state that the importer has adequate manufacturing facility capable of handling hazardous wastes in accordance with the provision of Basel Convention to Ministry of Environment; and

The new Trade Policy will specify that permission/authorisation specifying quantitative entitlement for the import of waste and scrap of electric accumulators issued by the Ministry of Environment would be required. A recent report in the international and national media pointed out that the colours used in the manufacture of toys contain lead above the permissible limits which is posing a potential hazard to the safety of children under 3 years of age.

Use of recycled material and unsafe designs are also hazardous. In order to regulate the import of toys for infants under international standards a certification from the exporting country that colours used in the manufacturing of toys are free from hazardous toxic elements may be made mandatory. Toys will be imported subject to the certification from the relevant government agency of exporting country that the toys have not been manufactured from recycled material and are free from hazardous toxic elements.

The sources said Commerce Ministry also plans to amend the existing import conditions for CKD kits to the extent that CKD components can only be imported by assemblers for models approved by EDB only. The certificate of registration for assemblers would be required, which the new Trade Policy deals with through the following insertion: "importable only by assemblers registered with Engineering Development Board (EDB) for such models as mentioned on the certificate of registration issued by the Board."

Old and used spraying/sprinkle lorries under PCT Code 8705.90000 having different makes and models such as Hino, Mazda, Nissan etc are being imported as multipurpose chassis fitted with water tank and detachable power sprayer (comprising of engine, spray, pump, hose 50 meter and spraying gun). These lorries are importable under para 10(iv) of Appendix-C of Import Policy Order 2009-10) irrespective of their age or any other restrictions. The facility is reportedly misused as instead of using these vehicles as spraying/ sprinkle lorries, the mounted tanks and other spraying accessories etc are removed once they arrive in the country and the same are sold in the open market to be used as trucks.

The ministry is recommending that it should be allowed to specify the criteria on the following lines: (i) impose conditions on its registration so that it should be registered as sprinkler lorry; (ii) impose restrictions on transfer of registration for a period of 5 years; (iii) impose quantitative restriction after consultation with MINFA; and (iv) pre-shipment inspection by designated companies regarding Euro Ill compliance and remaining productive life of at least 5 years and in good working condition.

The following technical specifications would also be required: (a) the chassis is custom-built for the purpose of sprinkler lorry and all the sprinkling equipment's/ tools have been installed in the premises of the manufacturers of the lorry; (b) choice of pump drives: ( engine/motor driven pump operated by the driver from the vehicle's cabin; (c) Component feature: spray head - fixed at mid of the vehicle, hose pipe/hose reels, all functions controlled from the cabin by the operator; and (d) Tank construction and capacity: Tank shall having capacity 1,000 gallons or more and components made up of high strength material.

The sources further said that it has been observed during the recent past that many unscrupulous importers are indulging in the import of used lubricating, hydraulic and transformer oils, etc, as waste oils under the garb of residue of petroleum oils. These oils are unfit for use as primary products. However, after certain refining processes, these oils are re-packed and sold in local market at cheap prices under counterfeit brands. These products are covered under hazardous waste as defined in Basel Convention.

It is therefore being proposed that all types of waste oils falling under PCT codes 2710.9100 should be banned for import by including it against S. No 14 of Appendix A. In order to restrict the misuse of residue of petroleum oils falling under PCT Codes 2713.9010 and 2713.9020, it is being proposed that the import of these items may be allowed only to industrial consumers subject to certification by the Ministry of Petroleum and Natural Resources.

Motor spirit including aviation spirit, kerosene, jet fuel (JP-1, JP-4), high speed diesel oil and other fuel oil would be made "importable by approved Oil Marketing Companies (OMC) only. Pakistan shares 730 kms long, porous and unmanned border with Iran (stretching from Qilla Rabat to Jiwani) which is the 4th largest oil producing country of the world.

The above petroleum products are abundantly available at cheap rates in the bordering areas between the two countries; inhabitants of the far flung border areas having no other means of livelihood and alternative source of fuels. They are also indulging in the lucrative business of POL products' smuggling which ultimately find their way to other regions/cities of the country.

It is being proposed that POL products like motor spirit and diesel may be allowed to be imported by importers belonging to these areas from the notified routes of border point 250, Rideeq, Chidgee, Katagar and Taftan on payment of leviable duty and taxes so as to curtail the menace of POL products' smuggling, and collect legitimate government revenue."

A suitable quota, keeping in view the demand of the area in consultation with Ministry of Petroleum and Natural Resources, will be prescribed for this purpose. In order to regulate import of bullet-proof raw materials like glass, used in vehicles and buildings, it is being proposed that a new serial number should be included for any bullet-proof material (whether meant for vehicle or any other purpose) to be importable on the recommendation of Ministry of Interior.

During the budget 2010-11, classification of asphalt pavers has been corrected which may also be rectified in the IPO. With regard to weaving machines, the sources said, import of such machines is allowed from India. The spare parts of weaving machine may also be allowed to be imported from India.

The machinery parts in old/used condition falling under different PCT heading of customs tariff in chapter No 84 & 85 which are to be particularly used in the machinery which is importable in old/used condition may be excluded from the appendix-C of the import policy order.

The procedure issued by the Ministry of Commerce for import of arms and ammunition of non-prohibited bore provides for import of these weapons on the basis of import authorisation in terms of value which creates room for mis-declaration as the importers tend to import more quantity by mis-declaring value. It is being proposed that the import of these weapons may be allowed on the basis of quantity to the commercial importers as allowed to privileged individual importers.

According to sources, it has been observed that commercial importers import used cooking oil under the garb of soap stock, etc under PCT codes 1518.0000 or 1520.0090. Although, these oils are unfit for human consumption, these are subsequently supplied to small hotels, bakeries and other road-side vendors to be used in different kinds of daily use edible items. It is being proposed that in order to curb this practice all types of used edible oils imported by commercial importers should be banned for import.