ISLAMABAD: The business community has aired serious concern over a rapid decline in the country’s exports and called for taking immediate steps to reverse the tide.

Chairing a business advisory meeting, Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Vice President Riaz Khattak said foreign currency reserves of Pakistan were under pressure as exports and remittances were falling while imports were rising, says a press release.

“Our exports fell 7% in July compared to the same month last year and this demands extra attention as exports have a critical place (in the economy),” he said, adding despite the offer of incentives to exporters in the budget, the performance of “inept export managers” of the Trade Development Authority of Pakistan (TDAP) was visible.

Among the factors responsible for the weakening exports, he cited decades of protectionist policies that had left the domestic industry uncompetitive and inefficient. “A protectionist policy works if it protects an infant industry, but protecting mature industries simply does not make sense and is not sustainable,” he remarked.

Even with infant industries, he suggested, there should be solid plans for their development, investment in their infrastructure, assisting them by driving innovation in sectors like horticulture and mineral exploration.

Khattak pointed out that India had used protectionist policies very effectively and now its exports were worth nearly $300 billion. They were just $23 billion two decades ago and have grown 15% per year on an average.

He backed the early shifting of TDAP’s head office to Islamabad, arguing it was the need of the hour as a majority of the business community from provinces other than Sindh had faced great difficulty in visiting the authority’s office in Karachi.

Separately, the Islamabad Chamber of Commerce and Industry also expressed concern over the dwindling exports, which had come down to $20.8 billion in fiscal year 2015-16 compared to $23.7 billion in 2014-15. It called on the government to take urgent measures to arrest the dangerous slide as declining shipments would pile pressure on foreign exchange reserves of the country and create more problems.

“A 12.24% annual decline in exports was unprecedented in the recent history and the government should conduct a candid analysis to determine major reasons of the poor performance of exporters and to take corrective measures,” ICCI President Atif Ikram Sheikh said.

He warned that falling exports and rising imports would increase the trade deficit and push Pakistan to rely more on external borrowings.

He asked the government to address inefficiencies in the export sector and improve the environment for conducting business in order to attract more foreign investment and revive exports.