Trade Boosting, a major challenge for economic revival

Increasing trade is essential for a country’s economy to grow and maintain a favorable exchange rate in the face of ongoing economic hardship and declining foreign exchange reserves.

The government’s inconsistent policies over the years slowly drove the nation close to an economic recession, posing issues such a low growth rate, import-export imbalances, a trade and current account deficit, and fluctuating currency values.

Massive borrowing from domestic and foreign financial institutions, particularly when the PTI government was in office, and the slowing down of important initiatives like the China-Pakistan Economic Corridor (CPEC), had made matters worse.

In this scenario, there was a dire need of prudent economic policies to steer the country out of crisis and laying down the foundations of a viable economy, more revenue collection, overcome trade deficit and stabilize our currency.

The current administration has therefore implemented a number of fruitful initiatives to actualize the nation’s geostrategic location for developing geo-economic strength with the goal of fostering external trade, which undoubtedly would result in the streamlining of the current account balance and encourage economic growth.

The exports of the nation exceeded $31 billion for the first time ever during the most recent fiscal year (2021–2022), and it was predicted that they would reach $50 billion in the next three years. However, in order to secure higher export growth, high export targets made it urgent to increase industrial production.

“Managing the trade deficit is a difficult task. As a result, we are looking for new markets to encourage regional and global trade for domestic products, according to Syed Naveed Qamar, the commerce minister.

The minister emphasized the importance of productivity in the information technology, agricultural, and industrial sectors, adding that regional commerce was highly important for raising the nation’s export. “Several agreements have been inked with Uzbekistan, Kazakhstan, and Tajikistan,” says the statement. “We are continuously negotiating with Central Asian republics for economic and trade integration.”

According to Naveed Qamar, Pakistan is negotiating with Iran and Afghanistan to expand bilateral trade, which includes barter trading.

Another area of attention to support the nation’s exports is to streamline company costs and make it easier for companies to operate in accordance with other regional marketplaces. Promotion of agricultural products could also lower the cost of imported food and the total trade deficit. As a result, the government is implementing policies to diversify the market, replace imports, and encourage regional trade.

He stated that trade negotiations with the United Kingdom were ongoing following Brexit and expressed optimism for successful outcomes soon.

Market and product excess, according to Waqas Azeem, are crucial for increasing commerce with the respective nations by twofold. To expand trade between the two countries, a trade and goods agreement was reached with Turkey.

Along with other services for exporters, the government has lowered energy costs to lower operating expenses for the export sector, particularly the textile industry, which has been appreciated by the textile and other export industries.

Irfan Malik, president of the Federation of Pakistan Chamber of Commerce and Industry, stated that “trade diversification at the market and product level is vitally important for expanding domestic exports.”

Even if the government is entirely committed to finding solutions to the problems caused by the trade deficit, the atmosphere of political unpredictability is severely impeding its efforts.
Even though it has announced preferential packages for the industry, agricultural, IT, and pharmaceutical sectors, Pakistan Tehreek-e-irrational Insaaf’s politics are proving to be too lethal. This is despite the fact that it is paying close attention to the major export industries.

Imran Khan’s decision to sacrifice the national interest for personal gain has brought practically all economic sectors to a halt, causing significant difficulties for managers of the economy.