Other Countries Access to Pakistan

Pakistan exports are higher than its imports at this point in time. Total exports of wooden furniture for the year 2005 amounted to US$12.3 million while imports were US$10.3 million. The MFN duty applied by Pakistan to the imports of different furniture products is 25%.14
Rapid growth of imports is taking place. A rapid growth of imports under the WTO liberalized import regime has taken place. Market share of main furniture exporting countries in Pakistan’s economy is increasing with a rapid pace. For example the export growth of China in the furniture sector to Pakistan is 278% between 2004 and 2005. According to industries’ sources the arrival of Chinese furniture has hit the local office furniture by 70% and the sales of locally manufactured household furniture have declined by 30%.

There is not much of a threat at present to the furniture industry. Whether, liberalization of trade has posed a threat to the furniture industry of Pakistan? There is prima facie not much of a threat to this industry at present though the industry’s sources have a negative perception of the situation. Our tariff rates are relatively high. Further, Pakistan’s bound rates are much higher than the applied tariff rates. In appropriate cases the affected industries can always approach the National Tariff Commission which provides an institutional mechanism for trade remedial action. However, these rates are likely to come down after an accord, if any, on NAMA (Non-Agricultural Market Access) under DDA. The malpractice of under invoicing and misdecaration have to be, however, checked to ensure such types of imports, having unfair competitive advantage, do not pose a threat to the domestic furniture industry.
One can not hope for a closed economy in a globalized world. In the world of liberalized trade one can not expect a closed economy and should not be upset about the flow of imports. However, the rate of growth in imports should be a matter of some concern as it constitutes a potential threat indicating a need for working on price competitiveness, quality enhancement of our products and stopping malpractices regarding valuation of imports. The Government of Pakistan should also seriously consider the demand of local manufacturers to decrease the import duties on the raw material including chipboard, adhesive, wood, foam and other related items to compete the foreign items at home.