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Most important exports of Pakistan are Cotton, Garments, Rice, Textiles. The main
trading partners are the United States of America, Hong Kong, Germany, the United
Kingdom and Japan. (EIU Country Report, 1st quarter 1998). Pakistan is the world's
biggest exporter of yarn accounting for about 35% of the global market. It accounts for
less that 0.5% of international trade in fabric and clothing (EIU Country Report, 2nd
quarter 1996). Pakistan exports are highly concentrated on few items. In 1995, cotton
alone accounted for 58% of the total exports, followed by leather (7%) and rice (5%)
(UNCTAD, 1996, p.475).
Export items such as men-clothing, woven-cotton, floor-coverings are doing well
with increasing market share in the world markets despite the lesser growing world
demands. Pakistan has performed very well in mens-wear-knit, exports of which are
growing faster than the word trade in general. Despite the growing world demands of rice
and cotton, Pakistan is losing its market share in these products which are its major
export items. Some losers in the declining market are women-clothing, man-made
fabrics, fruits and nuts. (ITC Trade Maps)
The following subjects have been indicated as the most relevant issues for the
business community (Response to the questionnaire, 23 February 1997):
å Improved access to foreign markets (reduction/binding of tariffs, abolition of
quotas)
å Subsidies, countervailing and anti-dumping measures
å Agreement on Textiles and Clothing
å Trade-related Aspects of Intellectual Property Rights (TRIPS)
å Trade-related Investment Measures (TRIMs)
å Agreement on Agriculture
Points for discussion
å Pakistani exports, especially textiles, are being increasingly subjected to initiation
of anti-dumping and countervailing investigations which create uncertainty and
depresses the business sentiment. Investigation periods are sometimes quite lengthy
and the legal costs of defending against these cases is prohibitive. This
phenomenon is a matter of particular concern because all investigations have so far
resulted in negative findings, but had created a damaging impact on normal growth
of trade (GATT/WTO, June 1995)
å ISO 9000 quality constraints on textile is another issue the business community is
concerned about. (UNCTAD, 1996, p.481)
å Stiffer competition from other developing countries in the area of agricultural
goods and garments is expected due to MFN tariff reductions (UNCTAD, 1996,
p.482).
å A struggle is going on between the Government and growers of cotton on one hand
and cotton mill owners and consumers on the other ± over raw cotton prices and
raw cotton export policies (EIU Country Report, 1st quarter 1996). The Pakistan
Government has pledged to allow free trade of cotton and has insisted that it had no
intention of capitulating to the demand of All Pakistan Mills Association (APTMA)
for a ban on lint exports. APTMA claimed its approximately 450 members required
up to 10m bales of cotton and that unrestricted exports would not only deprive them
of raw material, but also push up their production costs to uneconomic levels. High
levels of raw cotton production create an economic environment of attractive prices
for the spinning lobby, provided export of raw cotton is banned or discouraged.
(EIU Country Report, 1st quarter 1998)
å A new trade policy has been announced to boost exports of non traditional items
like computer software, engineering goods, and fish and food products, as well as
traditional items like cotton, yarn and textiles. Interest rates are being brought down
to reduce the cost of capital for exporters, import duties on a host of raw materials
for export of finished goods have been reduced or eliminated. The import of few
item such as chilies and pharmaceuticals have been allowed from India.
Restrictions on the import of gold and silver have been removed. (EIU Country
Report, 3rd quarter 1997)
å A controversial agreement governing the sale of key textile products to the USA
was reached by officials from both countries in Geneva in March, While the deal
provided for the addition of 360,000 bed sheets to Pakistan's 1996 quota of 2
million pieces ± its 1995 entitlement had been slashed by 691,080 pieces following
claims by Washington that exporters had sought to circumvent quota restrictions by
transshipping merchandise through a third country ± it also resulted in the
impositions of stringent rules of origin conditions and quotas on synthetic sheets
and pillow cases. (EIU Country Report, 2nd quarter 1996)
å Some of Pakistan's exports, such as footballs, surgical goods and other sporting
equipment, remain under close international scrutiny, as Western countries
intensify pressure to seek improved labour standards from developing countries.
(EIU Country Report, 1st quarter 1997)
å Pakistan and other members of SAARC wants the developed country Members of
WTO maintaining quantitative restrictions on textile and clothing products to
speedily eliminate such restrictions in order to provide commercially meaningful
market access for developing country exports of these products, and harmonization
of rules of origin on a non-discriminatory basis. (WTO Ministerial Conference, 18-
19 May 1998)
      
å Mr. Aqeel Ahmed Al-Jassem, Secretary General, Islamic Chamber of Commerce
and Industry, PO Box 3831, Kehkashan, Clifton, Karachi ± 75600. Tel: 0092 21
587 4910/587 4756. Fax: 0092 21 587 0765/587 4212 (Response to the
questionnaire, 23 February 1997)
å http://www.idealbusiness.com;
http://PakistanBiz.com - (names and addresses of various industry associations).

å EIU Country Report, The Economist Intelligence Unit, London, Quarterly
Reports
å WTO, June 1995, ‘

 



å ËSurvey of Business OrganizationsË, an ITC questionnaire survey on implications
of the Uruguay Round Agreements for the business community, 
 
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