BRUSSELS – The European Parliament on Thursday granted GSP Plus (Generalised Scheme of Preferences) status to Pakistan with 406 votes in favor, allowing duty-free to Pakistani products to the European Union countries.
After enjoying the GSP status Pakistan could export textile products to 27 European countries on zero percent tax. The act will come into effect from January 1, 2014 and it will remain till 2017.
It is expected that GPS Plus status will boost country’s exports, help revive the economy by creating more jobs and enable the government to spend more on education, welfare and social services.
After getting the GSP plus status, Pakistani exports would be exempted from the general rules.
The formal approval of the EU Parliament next month will allow almost 20pc of Pakistani exports to enter the EU market at zero tariff and 70pc at preferential rates.
EU trade concessions will benefit the country’s largest manufacturer and exporter, the textile and clothing industry, the most by enabling its products to compete with those of regional rivals like Bangladesh and Sri Lanka, which already have duty-free access to the bloc’s market
The European parliament was considering the GSP+ package for 10 developing countries in all.
The EU Parliament’s International Trade Committee has voted 17-12 in favour of Pakistan’s inclusion in the scheme for duty-free access to European markets.
Under the GSP Plus scheme, EU would eliminate or reduce import duties on several Pakistani products, including textile and clothing products, which would greatly help the country to boost its exports.
The scheme is expected to give a major boost to Pakistan’s exports to Europe, especially the textile and apparel exports.
At present, Pakistan’s textile exports to the EU markets attract 11 percent duty, which makes it difficult to compete with other countries like Bangladesh, which enjoy tariff benefit for exports to the EU.
The All Pakistan Textile Mills Association (APTMA) expects the GSP Plus status to double the country’s textile exports to US$ 26 billion from the current US$ 13 billion over a four-year period.
In fiscal year 2012-13, the EU accounted for about 25-30 percent of all textile and garment exports from Pakistan.
Textile exports had been declining in Pakistan, as manufacturers and exporters were finding it hard to compete with Sri Lanka and Bangladesh who already had duty-free access to European markets.
Meanwhile Prime Minister Muhammad Nawaz Sharif Thursday congratulated the nation over the award of GSP-Plus (Generalized System of Preferences-Plus) status to Pakistan by the European Union.
“Award of GSP-Plus status shows the confidence of international markets in the excellent quality of Pakistani products”, said the Prime Minister.
The Prime Minister said, “gaining access to European markets was the top most priority of the government as part of economic development agenda, which has been achieved due to continuous and hard work of the Ministers and Officials of the Ministries of Finance, Commerce and Foreign Affairs and friends of Pakistan in Europe”.
Meanwhile Governor Punjab Chaudhry Muhammad Sarwar while talking to state run TV channel said 186 votes were casted against and 406 members of the EU voted in the favor of GSP Plus status.
Governor Punjab said that one million Pakistani women and youth would secure jobs through this deal. He also congratulated Prime Minister Nawaz Sharif over the achievement of GSP Plus status. He also congratulated the whole Pakistani Nation. He said that the status would greatly benefit in industry and textile industry sector.
He said the agreement would benefit billions of dollars to Pakistan and would create millions of jobs. He said we could take benefit through this status. He said that the whole nation unitedly could take benefit from the GSP Plus status.