Prime Minister Shehbaz Sharif approved a temporary ban on the import of about three dozen goods, both essential and luxury items, on Wednesday, but refused to impose regulatory duties to limit them.
According to sources familiar with the meeting, he also agreed to limit imports of many goods, including completely knocked down (CKD) cars and mobile phone kits, by half of the previous month’s imports.
According to the Federal Board of Revenue sources, a summary will be moved soon to seek cabinet approval of the measures, and a notification is expected within 48 hours.
According to a senior government official, the decision to ban certain goods and impose quantitative restrictions on others will be temporary, lasting only two to three months.
The government will face difficulties in obtaining IMF approval to impose restrictions. It will also be required to notify the World Trade Organization of the measures, and the global free trade body will then seek input from the IMF on whether Pakistan’s economic conditions warrant such drastic measures.
The estimated monthly impact of the measures is less than $300 million, indicating that the government does not intend to severely limit economic growth in the new fiscal year preceding the next general election.
The prime minister rejected proposals to raise regulatory duties on imported goods, as well as recommendations to prohibit the import of cheese, chocolate, and other foods primarily imported from Europe.
Imports of CKD cars will be limited to half of that of SKD phone kits. According to the sources, the prime minister also approved a ban on imported carpets, with the exception of those from Afghanistan. Furniture, frozen meat, and pet food may also be prohibited.
The meeting was informed that if regulatory duties were significantly increased, it could be reduced by close to $1 billion, or roughly 15% of total monthly imports.
Imports stood at $6.6 billion in April 2022, while imports reached a record high of $65.5 billion in the first ten months of the current fiscal year. They could reach $77 billion by the end of June.
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