Pakistan’s Prime Minister Shaukat Aziz has approved the 2006-7 Trade Policy which sets an export target of $18.6 billion and includes incentives for the leather sector. This will represent an increase of around 13% on the export level attained this year. Exports for fiscal year 2005-06 amounted to $16.468 billion, an increase of $ 2.1 billion, or 14.4%, over last year's level of $14.391 billion.
Federal Minister for Commerce Humayun Akhtar Khan said, "During the period July 2005-May 2006, textile exports increased by $1.39 billion, rice by $178 million, leather products by $152.5 million, petroleum products by $42 million, chemicals by $23.1 million and other miscellaneous items by $88 million."
In addition, the total value of imports in the same period was $25.6 billion, 39.4% higher than the $18.4 billion for the corresponding period a year earlier.
Mr Khan believes the leather footwear sector has significant export potential but needs to make some improvements in its processes and products. Accordingly, it has been decided to provide this sector with 6% Research and Development support on the same lines as is presently available to the textile garments sector.
In 2005, a freight subsidy scheme was announced for leather garments up to 31st December, 2005. The freight subsidy scheme has been successful in attaining the objectives of diversification in exports and the scheme is now being continued in a modified form to cover products and countries for which the need for subsidy has been established.
In addition, within the framework of the Rapid Export Growth Strategy, the government plans to introduce a certain target oriented focus whereby special attention will be paid to the export promotion of certain product groups. This is being done with a view to facilitating annual exports of each of these products to a level in excess of a billion dollars within three years. The product groups selected for this purpose include leather products.
