ABSTRACT
Between 1960 and 1971, the government of Pakistan instituted a set of concrete, although complex, export incentive programs mainly designed to encourage the sale of manufactured goods. During the Ayub period Pakistan’s policies strongly favored exports as a vehicle for the expansion of the industrial sector, particularly textiles. The aim of export duties was to generate revenue, but equally in the immediate post-devaluation period they were to absorb windfall profits that would have accrued to exporters; of course, the purpose of devaluation should have been precisely to stimulate profits, investment, production, and exports in internationally competitive export industries. Rebates were given on sales and excise taxes and customs duties on imports used in the manufacture of exports. Originally, the amount of rebate in each case was decided separately on the basis of individual production units. Administrative regulations permit the manufacturer and exporter to export directly without the payment of excise duty.
