ISLAMABAD: Industrialists have called upon the government to obtain input from the relevant sectors prior to finalisation of Free Trade Agreement (FTA) with various countries.
“The results of previous FTAs especially with China have not been encouraging for the local industry and we fear similar results regarding Pak-Turkey FTA,” said Ameen Jan, Former management consultant and strategy advisor at Mckinsey & Company and United Nations.
He was addressing a roundtable on Thursday adding that the final negotiations over Pak-Turkey FTA was approaching and Pakistan should ensure a targeted approach to seek tariff reduction on high potential export items from Pakistan, but reduce customs duties at raw material imports and machinery that is helpful in encouraging local manufacturing.
He gave the example of the diaper industry in the country and said that concessions on raw material import along with inclusion of finished products in the negative list for upcoming Pak-Turkey FTA negotiations, will promote establishment of another quality diaper manufacturing unit in the country.
He asserted that trade should spur national economic growth but so far FTAs do not appear to be connected to the economic growth agenda.
“One reason for the increase in trade deficit is poor negotiation, in the FTA with China many of Pakistan’s leading exportable items were given lower concessions than Pakistan’s competitors from The Association of Southeast Asian Nations (ASEAN), which worsened our competitive position,” Mr Jan said.
He cited a recent research report by the Karachi Chamber of Commerce and Industry that too had highlighted the reasons for higher trade deficit.
Fewer concessions in beneficial products like apparel, cotton, footwear, and more concessions in disadvantageous products like fibers, manmade machinery and metals are also among the reasons, he added.