KARACHI: The Federal Board of Revenue (FBR) has imposed Regulatory Duty (RD) in the range of 5-80 percent on 731 importable items. SRO 1035(I)/2017 dated October 16, 2017 has suppressed all previous notifications that imposed RD.
Pakistan aims to generate Rs100 billion with the imposition of RD.
The latest notification imposing RD has created an anomaly in the web based Customs clearance system (WeBOC) as SRO No. 497(I)/2009 prohibits imposition of duties in excess of 37.5 percent on goods imported from China.
Since the SRO 497(I)/2009 is not withdrawn, the system would not accept duty in excess of 37.5 percent on goods imported from China.
An official said it was likely that the “Iron Brother” would somehow convince the Pakistan’s authorities and the SRO 497(I)/2009 would remain in place thereby curtailing all imports from all other origins.
The WeBOC system did not implemented SRO 497 on Tuesday and the imported goods were processed as per the duty structure defined by SRO 1035(I)/2017. However, officials fear that SRO 497 would be put back in place shortly, as the same has not been withdrawn as yet.
Officials said if duty structure remains limited to 37.5 percent for Chinese products, Pakistan would reap no benefit at all as majority of Pakistan’s imports are from China and in case of some products over 90 percent of imports are from China.
An official said the story of Pakistan-China Free Trade Agreement (FTA) was going to be repeated and it would only benefit Chinese side and Pakistan would suffer.
It may be recalled that Musharraf government implemented Pak-China FTA despite severe criticism and opposition and consequently a number of local industries were closed while Pakistan’s trade deficit kept on ballooning. Similarly, Pakistan, despite criticism and opposition, is pursuing China-Pakistan Economic Corridor (CPEC) and the terms of its are not much favorable for Pakistan contrary to the propaganda.
Local industries are already complaining that they were deprived of the level-playing fields due to certain concessions and benefits accorded to China.
The SRO 1035(I)/2017 includes almost all the products which are imported from China and unless SRO 497(I)/2009 is withdrawn, the imposition of regulatory duty would not be beneficial for Pakistan’s economy.
The list of 731 items on which RD is imposed can be viewed here:
http://download1.fbr.gov.pk/SROs/2017101712101357551SRO.(1035)-2017dated16.10.2017.pdf