Saturday, March 22, 2014
LAHORE: Experts wonder if the government has factored the impact of Indian subsidies given to the business community in its plan to grant non-discriminatory market access to India.
Will Indian businessmen be given free access to Pakistani market without ensuring an equal access for Pakistani products in the Indian market, they inquire, while talking to us on Friday.
A leading entrepreneur Anjum Nisar asks the government if it has taken safeguard measures to stop the intrusion of subsidised Indian products.
No sane businessman opposes free regional trade, yet, that doesn’t imply that Pakistan allows subsidised products from neighbouring countries on normal duties, adds Nisar, who with his two younger brothers comes among the list of top taxpayers in the country.
He says the government should also show some seriousness in eliminating the menace of under- invoicing in the country. “Local manufacturers are running from pillar to post to get their genuine grievances redressed in this regard.”
The businessman says if heavily subsidised Indian products start entering Pakistan at extremely under-invoiced value, it would be a severe blow to the local manufacturers.
He does not know if there is any special duty structure for products coming from India.
“Yes, Pakistani government has the documentary evidence of subsidies Indian agriculture, textiles and engineering goods have,” he says.
The government should discuss this issue with the Indian authorities to arrive at certain regulatory duties equivalent to these subsidies, he advises.
Nisar further says that the private sector can provide the authentic data about all products that are entering Pakistan at lower than their real values.
He suggests that the government should immediately appoint a trustworthy international firm to fix the import tariff price for all imported products.
A veteran businessman links the investment with the clearing of policies on trade with India.
Several investors have held back their expansion plan and are waiting for the government’s action on controlling under-invoicing and the market access, says Usman Malik, the chairman of Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam).
He says the auto vendors have not been able to localise numerous parts because of the menace of smuggling. Even some of them closed down due to this, he adds. Paapam chief says a manufacturing plant of spark plug was shut down on heavy under-invoicing.
He further says Indian auto vendors receive steel at subsidised rate, while their Pakistani counterparts have to pay for international price.
Malik says that as per the norm the subsidised Indian auto parts will come to Pakistani market at under-invoiced value, which will affect the local vending industry.
Before acquiescing to the free trade regime, the government has to evaluate the impact of under-invoiced products and to reform the bureaucracy that facilitates the under-invoicing, he advises.
Chairman Paapam, however, defends under-invoicing. “Businessmen are forced to import at under-invoiced value because all others are doing the same,” he says, adding but the government officials instead of businessmen get benefit from under-invoicing.
An agriculture expert Hamid Malhi says that even Indian agriculturists term it unfair for Pakistan to import farm produces without imposing on them additional duties in proportionate with the subsidies.
This opinion of Indian farmers was recorded in the minutes of the meeting held last month between the representatives of farmers of the two countries, he says.
Pakistan has already suffered badly due to import of subsidised vegetables from India and even the high-yielding and low-cost vegetables produced from the tunnel farming could not compete with subsidised Indian vegetables, Malhi says.- The NEWS
Agriculture, Agriculture in Pakistan,