During the meeting, the representative of the Textile Division stated that the textile- led sub- committee had carried out a tariff rationalisation exercise of textile product chain based on cascading principles and passed it to the Federal Board of Revenue (FBR) which took no action. He also pleaded that existing tariff lines relating to textile products had a lot of irrationalities, adding that their proposals had addressed these anomalies.
The issues included the Engineering Development Board's (EDB) failure to implement reforms in the auto sector because of the reported friendly relations between the auto giants and the top brass of the Board. The Secretary Commerce accused the Ministry of Industries, the Ministry administering the EDB, for hesitating in undertaking auto sector reforms. The government has already invited applications for the appointment of a new Chief Executive Officer (CEO) EDB so that it could be made a vibrant organisation in real terms, the sources maintained.
The meeting also discussed the role of National Tariff Commission (NTC) in tariff rationalisation in the light of objections raised by the FBR. After a detailed discussion, the meeting decided that the Commerce Division will identify top 10 exporters in each sector and encourage them to double exports by providing them incentives and resolving their issues.
The sources said that the Minister for Planning Commission directed the Commerce Division to form a task force to prepare a roadmap to increase the market share in imports of Afghanistan to 60-70 percent and give presentation on trade with Afghanistan to Minster for Planning and Development. The meeting also discussed issues related to trade with India especially steps taken to address the concerns of local industry.
Minister directed Commerce Ministry to give a presentation to the Minster for Planning and Development on trade with India highlighting threats to our local industry and opportunities for expansion of exports to India. The issues of under-invoicing with China also came under discussion in the meeting. After hearing viewpoints of different stakeholders, the Minister directed the Secretary Commerce to find out how under-invoicing was resolved in other countries and update the Minister accordingly.
The Secretary industries in co-ordination with the Secretary Commerce was tasked to work on industrial clusters and to determine how that can be converted to export-led growth opportunities. The meeting decided that the Chairman FBR led committee constituted in the budget speech 2013-14 of the Finance Minster will be broadened by incorporating other stake holders including Commerce Division, Textile Division, Industries Division, NTC and Engineering Development Board (EDB). The committee also decided to first identify sectors with a positive multiplier export items and to look into import liberalisation.
Working Groups on trade and industry for Medium Term Plan 2013-18 of the Planning Commission would be developed to integrate the work of FBR-led tariff rationalisation committee and SPTF 2012-15 of Commerce Division. According to sources, the Commerce Ministry was directed a prepare a summary on "way forward" of tariff rationalisation for submission to the ECC through the Ministry of Planning and Development, thereby making a proposal for replacing the existing tariff rationalisation exercise with a more focused approach containing: a strategy for export-led growth, evolving a stronger and meaningful tariff rationalisation efforts by broadening the FBR committee on tariff rationalisation constituted in Federal Budget 2013-14, and doing away with all duplications relating to tariff rationalisation work, and strengthening of National Tariff Commission.