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Export of value added goods

Export of value added goods

 

According to a report issued by the Pakistan Bureau of Statistics,the exports of value-added textile products have recorded an increase of 16.5 percent during the first two months of the fiscal year 2017-18. The exports of readymade garments have grown by 15.65 percent year-on-year to $418.63 million in July-August, making the value added products a driving force to boost the overall exports. At a time the world economies are trying to stimulate business and trade activities, the economy of Pakistan is going down which should be a matter of concern for the government policymakers. However, political instability and unidentified expediencies are the other reasons coming in the way of economic growth. According to financial experts, Pakistan has all the necessary components to push itself to the developed economies, but whenever it takes a step forward, something unusual happens and it takes two steps back. This routine has been going on since independence. The export data reveals that exports of knitwear has posted a growth of 7.53 percentby earning $439.26million in two months. The bedwear exports have noted over 8 percent risein terms of money and earned $384.32million while it has recorded a growth of 8.79 percent in terms of quantity.

It is good omen that the exports are focused on the value added goods rather than food items which are already insufficient to feed the growing population. The business circles hope the value-added sector has the potential to record growth in overall exports as well as the economy. This is probably the first time in over three years that exporters have fully exploited the preferential access to the 28-nation European Union under the GSP plus scheme by exporting the value-added textile products. However, a setback is recorded in the export of cotton yarn which has fallen by four percent in value and over three percent in terms of quantity. Official circles hold the low demand of yarn in China as the main cause of low yarn export. The export of raw cotton has also dropped by 14.7 percent in value and 14.15 percent in volume during in the first two months of the financial year 2017-18. Unfortunately, the exports of fine quality rice has witnessed a growth of 40 percent which will earn foreign exchange, but could create inflation in the country. Instead of food items, the government should encourage the export of petroleum products, carpets and sports goods.