Pakistan trade deficit shrank $4 billion. 13.1% reduction in trade deficit in 10 months.

[PakSword]

I’m still seeing a lot of household products from overseas in shops.... I’m hoping the govt stops importing these which will encourage domestic companies to manufacture and compete

That's what I am saying and some people are not understanding me..

I mean cheese? a country like Pakistan imports European cheese? Which part of the supply chain it is used to produced export goods?

1800 and above cc cars.. I mean people who are buying these expensive cars should be able to pay 100% more duty..

 

[shah_123]

On the other hand, nation wakes up and starts producing things internally..

As an example, one of the imported item is cheese.. our milk companies may start producing fine quality cheese internally and later on we may be able to export that to other countries..

We don't necessarily have to export everything, our local consumption in big enough to absorb the local production. ----- This govt is incompetent, they don't even have their own economics team -- Asad Umar is incompetent , Hafeez is just a traditional imf tattu and now our economy outsourced to imf.

This govt doesn't have the balls to ban the import of luxury items, say 2000 cc cars, cigarettes etc., ----- They have targeted those items mainly imported by small/medium traders.

The right course is to provide tools of production to the nation and when the production starts, gradually imports will automatically come.down

 

[PakSword]

Look at the stupid things we import too.

http://www.worldstopexports.com/pakistans-top-10-imports/

90% of this could and should be made at home.

Exactly.. this I would like to point out.. we import stupid things.. which we can produce or even export..

This govt doesn't have the balls to ban the import of luxury items, say 2000 cc cars, cigarettes etc., ----- They have targeted those items mainly imported by small/medium traders.

You don't have to ban these luxury items.. just put 200% tax/ duties.. the people who like to drive a mercedes will still drive it... and a man who smokes imported Marlboro or B&H will still smoke that imported brand.. but government will earn a lot of revenue through these imports.

 

[shah_123]

We cannot make electricity cheap as all those loans taken by previous govt made them expensive and this will continue until deficit is brought down which none of previous govt did.

If you can't make cheap electricity than say Tata Tata Bye Bye to exports.

By the time you will bring down the deficit, the economy will be DEAD, than ask deads to produce goods for exports.

and above all, you can't win a war waged against ALLAH swt' and Prophet Muhammad saw'.

Exactly.. this I would like to point out.. we import stupid things.. which we can produce or even export..


You don't have to ban these luxury items.. just put 200% tax/ duties.. the people who like to drive a mercedes will still drive it... and a man who smokes imported Marlboro or B&H will still smoke that imported brand.. but government will earn a lot of revenue through these imports.

but the govt did the opposite by reducing taxes on luxury.cars

 

[PakSword]

Look at the stupid things we import too.

http://www.worldstopexports.com/pakistans-top-10-imports/

90% of this could and should be made at home.

1. Mineral fuels including oil: US$17.1 billion (28.4% of total imports)
2. Machinery including computers: $6.3 billion (10.4%)
3. Electrical machinery, equipment: $4.3 billion (7.2%)
4. Iron, steel: $3.7 billion (6.1%)
5. Organic chemicals: $2.8 billion (4.6%)
6. Vehicles: $2.6 billion (4.3%)
7. Plastics, plastic articles: $2.5 billion (4.1%)
8. Animal/vegetable fats, oils, waxes: $2.1 billion (3.5%)
9. Oil seeds: $1.5 billion (2.4%)
10. Cotton: $1.3 billion (2.1%)

The red ones we can easily avoid, the orange one we can earn a lot of revenue from..

but the govt did the opposite by reducing taxes on luxury.cars

I thought they increased taxes on luxury cars.. may be I am wrong.. where did you get this information?

 

[BHarwana]

If you can't make cheap electricity than say Tata Tata Bye Bye to exports.

By the time you will bring down the deficit, the economy will be DEAD, than ask deads to produce goods for exports.

and above all, you can't win a war waged against ALLAH swt' and Prophet Muhammad saw'.

Nope deficit will come down and if coming down with a growth rate at 5.7%

Yes loans are bad and you must appreciate PTI for working on reducing deficit to stop loans.

 

[PakSword]

In major taxation measures, the government has targeted the imported luxury cars. It has increased the Federal Excise Duty (FED) on imported cars and jeeps of engine capacity exceeding 1800cc to 25 percent from existing 20 percent. Meanwhile, the FED on imported cars and jeeps of engine capacity exceeding 3000cc has enhanced to 30 percent. Furthermore, it has proposed to levy Excise Duty of 10 percent on locally manufactured/assembled cars and SUVs etc with engine capacity exceeding 1800cc.

@shah_123

The government, in Finance Supplementary (Second Amendment) Bill, 2019 has also revised the taxes on the import of mobile phones. The government has proposed to reduce the tax to Rs400 from Rs1025 on the mobile phone costing Rs10,000. On the mobile phone that retail price is Rs28000, the tax has reduced to Rs4000 from existing Rs4368. Similarly, the government would charge Rs6000 tax on the mobile phone, which retail price is Rs60,000. Meanwhile, there would be Rs23000 tax on the phone that cost is Rs150,000. Furthermore, the government would charge Rs41000 on the import of phone, which cost is Rs150,000 and plus.

 

[bafxet]

Because $4 billion is a lot of money and achieving that in just 10 months is a big achievement so by the time of next election we will have very low trade deficit. It takes time to reduce trade deficit of $30 billion.

It is not a lot if money!!! State Bank stopped booking dollars for imports. You do so at any point in time and as a result the import will come down and consequently you will end up saving dollars.

There is a campaign going on the Dar was bad. Fine if he was bad than they are worst.

 

[PakSword]

you can't win a war waged against ALLAH swt' and Prophet Muhammad saw'.

That's right.. but what about the promises you have already made to your creditors?

It is not a lot if money!!! State Bank stopped booking dollars for imports. You do so at any point in time and as a result the import will come down and consequently you will end up saving dollars.

There is a campaign going on the Dar was bad. Fine if he was bad than they are worst.

Something is better than nothing..

 

[BHarwana]

It is not a lot if money!!! State Bank stopped booking dollars for imports. You do so at any point in time and as a result the import will come down and consequently you will end up saving dollars.

There is a campaign going on the Dar was bad. Fine if he was bad than they are worst.

You cannot totally crub imports and Dar was bad or good I don't know but the economic policy of Dar was bad. Hyping the economy with cheap dollar is never a good thing. You should only do that if you have a trillion dollars foreign reserves.

 

[313ghazi]

1. Mineral fuels including oil: US$17.1 billion (28.4% of total imports)
2. Machinery including computers: $6.3 billion (10.4%)
3. Electrical machinery, equipment: $4.3 billion (7.2%)
4. Iron, steel: $3.7 billion (6.1%)
5. Organic chemicals: $2.8 billion (4.6%)
6. Vehicles: $2.6 billion (4.3%)
7. Plastics, plastic articles: $2.5 billion (4.1%)
8. Animal/vegetable fats, oils, waxes: $2.1 billion (3.5%)
9. Oil seeds: $1.5 billion (2.4%)
10. Cotton: $1.3 billion (2.1%)

The red ones we can easily avoid, the orange one we can earn a lot of revenue from..


I thought they increased taxes on luxury cars.. may be I am wrong.. where did you get this information?

Click on the drop down menu and look at the breakdown.

In 2018, Pakistani importers spent the most on the following 10 subcategories of mineral fuels-related products.

Processed petroleum oils: US$6.8 billion (down -7.9% from 2017)
Crude oil: $4.9 billion (up 56.3%)
Petroleum gases: $3.5 billion (up 80.6%)
Coal, solid fuels made from coal: $1.6 billion (up 52.5%)
Petroleum oil residues: $128.5 million (up 160.4%)
Coke, semi-coke: $46.3 million (up 41.9%)
Coal tar oils (high temperature distillation): $45.4 million (up 32.4%)
Electrical energy: $40.3 million (up 21.7%)
Petroleum jelly, mineral waxes: $10.7 million (up 8%)
Peat: $486,000 (up 185.9%)

If we had refinery capacity we'd only need to import crude, not processed materials. This means we'd spend less on imports AND we'd generate jobs and taxes via refineries.

In 2018, Pakistani importers spent the most on the following 10 subcategories of machinery.

Computers, optical readers: US$390.1 million (up 3.7% from 2017)
Air or vacuum pumps: $349.9 million (down -12.6%)
Sort/screen/washing machinery: $318.7 million (up 4.2%)
Vapour-based boilers: $313.6 million (down -41.4%)
Miscellaneous machinery: $300.1 million (up 40.3%)
Temperature-change machines: $241.3 million (down -15.2%)
Piston engine parts: $229.5 million (up 1.8%)
Liquid pumps and elevators: $228.7 million (up 20.5%)
Turbo-jets: $217.5 million (down -53.6%)
Taps, valves, similar appliances: $204.2 million (up 40.7%)

We can't machine taps and valves? We're importing AC? Apart from computers everything else is nearly 100 year old tech. Why aren't we manufacturing those? Make it expensive to import and suddenly there is market opportunity.

In 2018, Pakistani importers spent the most on the following 10 subcategories of iron and steel.

Iron or steel scrap: US$1.6 billion (up 8.1% from 2017)
Hot-rolled iron or non-alloy steel products: $517.8 million (up 29.5%)
Flat-rolled iron or non-alloy steel products (plated/coated): $359.6 million (up 2.1%)
Flat-rolled other alloy steel products: $354.7 million (down -26.8%)
Cold-rolled iron or non-alloy steel products: $228.8 million (up 50.5%)
Flat-rolled iron or non-alloy steel products (< 600 mm): $214.3 million (up 69.6%)
Flat-rolled stainless steel items: $135.9 million (up 16.2%)
Coiled other alloy steel bars, rods: $83.6 million (up 36.7%)
Iron ferroalloys: $62.3 million (up 3.1%)
Iron or non-alloy steel bars, rods: $36.7 million (down -28.5%)

Why are we importing scrap metal? We have our own steel mill, why are we buying others processed steel?

 

[shah_123]

In major taxation measures, the government has targeted the imported luxury cars. It has increased the Federal Excise Duty (FED) on imported cars and jeeps of engine capacity exceeding 1800cc to 25 percent from existing 20 percent. Meanwhile, the FED on imported cars and jeeps of engine capacity exceeding 3000cc has enhanced to 30 percent. Furthermore, it has proposed to levy Excise Duty of 10 percent on locally manufactured/assembled cars and SUVs etc with engine capacity exceeding 1800cc.

@shah_123

The government, in Finance Supplementary (Second Amendment) Bill, 2019 has also revised the taxes on the import of mobile phones. The government has proposed to reduce the tax to Rs400 from Rs1025 on the mobile phone costing Rs10,000. On the mobile phone that retail price is Rs28000, the tax has reduced to Rs4000 from existing Rs4368. Similarly, the government would charge Rs6000 tax on the mobile phone, which retail price is Rs60,000. Meanwhile, there would be Rs23000 tax on the phone that cost is Rs150,000. Furthermore, the government would charge Rs41000 on the import of phone, which cost is Rs150,000 and plus.

https://www.dawn.com/news/1473841
FED on 1,700cc above vehicles to be withdrawn: Razak

1. Mineral fuels including oil: US$17.1 billion (28.4% of total imports)
2. Machinery including computers: $6.3 billion (10.4%)
3. Electrical machinery, equipment: $4.3 billion (7.2%)
4. Iron, steel: $3.7 billion (6.1%)
5. Organic chemicals: $2.8 billion (4.6%)
6. Vehicles: $2.6 billion (4.3%)
7. Plastics, plastic articles: $2.5 billion (4.1%)
8. Animal/vegetable fats, oils, waxes: $2.1 billion (3.5%)
9. Oil seeds: $1.5 billion (2.4%)
10. Cotton: $1.3 billion (2.1%)

The red ones we can easily avoid, the orange one we can earn a lot of revenue from..

Item# 8-9 can be easily managed, it's totally in govts hands, we import these just because of incompetency of govts.

Item#7 used to be in production 20 years ago, shortage/expensive electricity+ corrupt system forced people to import this from China.

Item#10, we just need a policy from govt -- it's again incompetency of govts. --

 

[PakSword]

https://www.dawn.com/news/1473841
FED on 1,700cc above vehicles to be withdrawn: Razak

This is about locally manufactured, right?

ISLAMABAD: Adviser to the Prime Minister on Commerce, Textile and Industries Abdul Razak Dawood on Wednesday said the 10 per cent federal excise duty (FED) on locally manufactured cars and sports utility vehicles etc with engine capacity exceeding 1,700cc would be withdrawn.

 

[bafxet]

You cannot totally crub imports and Dar was bad or good I don't know but the economic policy of Dar was bad. Hyping the economy with cheap dollar is never a good thing. You should only do that if you have a trillion dollars foreign reserves.

Nobody is curbing imports but a 13% reduction is insignificant and less than 1% in exports is a sad thing. You must not have accused Dar if you didn't know whether his policies were right or wrong. It is unfair.


IK's new economic team might be brilliant but they have a prescribed strategy to fix economic health of the country.


Agreed that technicaly IMF's prescription is logical but that's not the only solution. It's a stoic but lathargic, casual, apathatic & callous aproach. We have been under IMF regim from 1999 to 2014 and what we got, is known to everyone i.e. a dismal growth rate of 2% to 2 5%.


But, then Dar decided to abandon IMF & adopted a different strategy of strong rupee, controlled fiscal deficit, low inflation & cheap financing...which are essential for making an investment viable and therefore help improving growth & GDP. One of the best thing he did was boast investor confidence.


He built FE reserves, FDI increase, the domestic revenue collection doubled, yes virtually doubled. This allowed him to lower the interest rates thereby lowering the cost of doing business. The alternate path he used to raise FX was Sukuk, short & medium term Euro bonds, increase saving rates, trade & fiscal incentives. Remember that the current account deficit is the main culprit and it can be overcame making investments in new sectors as well as the older ones


Today's currency devaluation phenomena is a loot, plunder & ecomnomic decoity by vested interest who are hoarding dollars since a long time. Whenever there was a spike in the rate of USD in Kirb market Dar use to go into the throat of money changes. Malik Bustan Khan the President of Foreign Exchange Association had to go to Islamabad to assure him of keeping the exchange rate under control.


Everybody has weakness and Dar might have them too. But given the state of the economy of this country which is notorious not performing for decades except for massive US Aid he did a good job.

 

[Sugarcane]

We should cut palm oil consumption, last year we imported crude oil worth $5b and palm oil worth $2b.