ABSTRACT
Pakistan has been experiencing a trade deficit since its existence in 1947, except for 3 years. Similarly, its major export commodities have been limited to cotton and textile manufactures, leather, sports goods, rice, mango, and citrus which account for about 70% of total Pakistan's exports. In the same vein, its exports markets have been limited to the the United States, the United Kingdom, Germany, China, the UAE, Afghanistan, and France which capture about 50% of Pakistan's total exports. Moreover, its major markets in the nearby regions such as China, India, Iran, Afghanistan, Saudi Arabia, the UAE account for about 23% of Pakistan's exports; however, these markets have a great potential, particularly China. Pakistan is capturing only 0.1% of China's total global imports of USD 2 trillion indicating the existence of a huge potential. The China Pakistan Economic Corridor (CPEC) can play a crucial role in enhancing Pakistan's trade with China provided Pakistan prepares itself to get benefit from it, in particular, through producing quality and differentiated products at competitive prices. In this regard, it should diversify to value added products such as mango pulp, dried mango slices, and so on keeping in view the demand structure in China. China is among the top ten importers of rice, mangoes, mango pulp and so on, and government policies and interventions are very important in this regard. For instance, there are no exports of mango pulp from Pakistan to China. There is only one mango pulp plant, which is offering services for domestic sales. If two more pulp plants, one in Multan and one in Rahim Yar Khan are established for export purposes targeting the Chinese demand through the CPEC. In the short run, rice, citrus and mangoes are the potential commodities to increase exports to China. In the medium term, value added products of these commodities are the potential items and in the long run their sustainability and chilies, potatoes, soya and its products, and water melons can be targeted. Moreover, in the long run Iran and Afghanistan can also be targeted as they might become the part of CPEC. Reducing the cost and meeting the quality standard and product differentiation through entrepreneurial ability is crucial for enhancing regional trade. This can be done by investing on research and development, in particular, on market research, increasing yield per hectare and implementing quality standards through training of farmers and stakeholders.
