UNISAME for establishment of Exim Bank, revamping of SME BankJuly 21, 2015
KARACHI: The Union of Small and Medium Enterprises (UNISAME) has invited the attention of federal commerce minister engineer Khurram Dastagir that the ambitious exports target of $40 billion in the Strategic Trade Policy Framework (STPF) 2015-18, which is likely to be announced in next month (August), would not be possible without the contribution of the SME sector as its inclusion is of prime importance.
President UNISAME Zulfikar Thaver said we have appealed to the commerce minister to strengthen the SME sector by well designed strategy. The SME sector needs full support of the government and to invigorate it, it is very important that marketing support is provided by the Trade Development Authority of Pakistan (TDAP) to engineering, sports and surgical goods, textiles, rice, and other commodities. Exports have fallen considerably and strategy is required to include the SMEs.
He lamented: “Our demands of SME export house have not been taken seriously. The SME export house is the need of the hour and a modern export house having all the facilities of providing information, education, search engines and product galleries is required to achieve the targets and without the SME sector the government will never be able to achieve the targets.”
Thaver added that we can say with all emphasis at our command that the SME sector has the potentiality to double its exports if it gets the support of the Small and Medium Enterprises Development Authority (SMEDA) and TDAP. It is unfortunate that both the authorities are unable to comprehend the advantages and merits of the proposed export house. Although both have done preliminary working on the setting up of the export house. TDAP even formed a steering committee and SMEDA prepared the feasibility.
It is very important that before the draft of Strategic Trade Policy Framework (STPF) 2015-18 is submitted which is in the final stages of its completion includes the setting up of the SME export house for the sector and then presented to sub- committee of the Cabinet for further deliberations. After incorporating the recommendations of the sub-committee the draft will be submitted before the Cabinet for final approval.
It is pertinent to note that the government has failed to achieve the targets set in the previous Strategic Trade Policy Framework 2012-15. It also failed to achieve exports target of $95 billion in three years, as it remained under $70 billion mainly due to the poor law and order and energy situation in the country. In the budget estimates for 2014-15, the federal government had earmarked Rs 2 billion for STPF. Not a penny was spent under this head, according to the budgetary documents and as reported by the media.
UNISAME has called for the prompt establishment of the Exim Bank and the revamping of the SME Bank and the SME Leasing, other institutions of prime importance are the SME insurance, the venture capital fund and the SME technical institute. The government will fail again if the SME sector is not included as this is the majority sector and the big investors and industrialist are on the back foot due to energy crisis and political uncertainty whereas the SME sector is here to stay and never thinks of migrating and shifting capital to foreign countries.
The government had missed the exports target of $27 billion and revised target of $24.2 billion during last financial year 2014-15. Pakistan’s exports had gone down by 4.88 percent to $ 23.885 billion in previous fiscal year from $25.11 billion of the preceding year. However, imports had enhanced by two percent to $45.98 billion in FY2015 from $45.07 billion of the FY2014.