Italian Review


Pak-Italy bilateral trade reached US$ 1.5 billion in 2017-18
by Prof. Dr. Noor Ahmed Memon, Dadabhoy Institute of Higher Education.

Italy has always followed with keen interest the Pakistani market and in the past decades has gradually increased its’ position, thereby becoming one of the top ten global trading partners of Pakistan and the third amongst the EU member States. The US$1.5 billion bilateral trade between the two countries in 2017-18 is the proof of this mutually reciprocal relationship.

The exports from Pakistan to Italy have increased under Generalized System of Preferences-Plus Scheme. Over the past five years trade between Pakistan and Italy has increased but the rise in exports has been greater than the imports. However, balance of trade in favour Pakistan decreased from US$ 316 million in 2013-14 to US$ 53 million in 2017-18.Pak-Italian trade is given in Table 1.

Table 1: Pak - Italy Trade Balance
                                                                                  
       (US$ Million)

Year Exports Imports Total
Trade
Trade
Balance
2013-14 671 355 1,026 +316
2014-15 733 347 1,080 +386
2015-16 642 409 1,051 +233
2016-17 667 547 1,214 +120
2017-18 766 713 1,479 +53
      Source: ACIMIT

Exports

Cotton fabrics and yarn, readymade garments, towels, hosiery, beddings, carpet and rugs, cotton, leather, sports goods and surgical instruments are the major items exported from Pakistan to Italy.

Italian Textile Machinery Exports to Pakistan
(Million Euro)

Source: ACIMIT

Export of textile and other items from Pakistan to Italy increased US$ 671 million in 2013-14 to US$ 766 million in 2017-18, thus showing an average increase of 3% per annum due to import of machinery. Exports of textile and other items from Pakistan to Italy are given in Table 2.

Table 2: Export of textile and other items
 from Pakistan to Italy
                                                                             (US$000)

Product

2015-16 16-17 2017-18

 Cotton fabrics

152,209 152,468 163,869

 Bedwear

87,504 102,231 119,382

 Readymade garments

82,610 88,344 92,735

 Knitwear

57,587 51,919 58,057

 Cotton yarn

16,372 21,740 30,091

 Towels

30,853 32,593 36,707

 Textile made-ups

12,338 14,834 13,993

 Tents and canvas goods

66 109 140

 Art silk & synthetic textiles

8,204 5,229 13,763

 Leather

56,357 49,652 52,156

 Carpets and rugs

3,582 4,014 4,581

 Surgical goods

6,973 6,850 1,604

 Rice

18,420 17,385 36,933

 Leather gloves

6,519 4,499 5,466

 Others

102,758 114,713 136,523

 Total

642,352 666,580 766,000

 Source: Trade Development Authority of Pakistan

Imports

Textile machinery, general industrial machinery, power generating machinery, petroleum products, transport vehicles, iron and steel, pharmaceuticals, acrylic fibre, chemicals and paper and paperboard are the main items imported to Pakistan. Import from Italy to Pakistan also increased from US$ 355 million in 2013-14 to US$ 713 in 2017-18, thus showing an average increase of 20% per annum.

Pakistan is an important market for textile machinery. Textile machinery market is closely influenced by the textile industry; regulations affecting this market have a direct bearing on the textile machinery market. Italian textile machinery imports in Pakistan increased from 40 million Euros in 2014 to 86 million Euros in 2018, thus showing an average increase of 29% per annum. The most requested Italian machines were the finishing ones (44% of the total export towards Pakistan), followed by spinning (20%) and knitting machines (15%).

Italian Textile Machinery Exports To Pakistan
By Categories 2018

Source: ACIMIT

Moreover, access of Pakistan to the GSP Plus (Generalized System of Preferences – Plus) as from January 1st 2014, boosted the country’s economy, by allowing a high number of lines of products (especially from the textile sector) to enter free of duty into the EU markets. Over the years, Italian companies have been looking more and more at Pakistan for trade and investments.

Energy remains the most important sector, while alternative energies, including solar, wind and bio-gas, are acquiring a growing importance in commercial relations.

Dr. Gianpaolo Bruno, Italian Trade Commissioner to the UAE, Oman & Pakistan

Trade promotion is becoming increasingly complex and difficult in the era of globalization, where every day brings new commodities and market forces in the global trading system. The Italian Trade Commission has always worked under the auspices of the Embassy and Consulate of Italy to enhance the existing trade relations between Italy and Pakistan.

The office of Italian Trade Commission in Karachi is a fundamental part of our strategy in strengthening Italian ties with Pakistan in all sectors. The Italian government has a strong operational arm in Pakistan to help in the promotion and support of Italian trade interests in Pakistan. Italian industrialists have been enjoying good trade relations with their Pakistani counterparts for the past many decades. However, there is still a need to further improve the ties by focusing on enhancing interaction and undertaking trade promotion initiatives.

The Italian Trade Commission is the Italian government trade and investment promotion agency whose duty is to develop, facilitate and promote the economic and trade relations of Italy with other countries, with particular emphasis on the needs of small and medium sized businesses. In the year 2018 exports from Italy to Pakistan was worth 801 million euros, increasing 5.9 per cent compared to 2017. Pakistan’s exports to Italy also increased by 3.9 per cent to 654 million euros. Hence, the balance of trade was 147 million in favour of Italy. I am therefore sure that the great interest shown by Italian companies for Pakistan will result in further opportunities of collaboration between two countries.

Comments by Anna-Ruffino, Consul-General of Italy in Karachi

Italy is among the top ten trading partners of Pakistan and the third amongst the EU member states with exports from Italy growing from Euro757 million in 2017 to Euro 801 million in 2018, while the import figures were Euro 629 million in 2017 and has now increased to Euro 654 million in 2018 resulting in balance of trade in favor of Italy to Euro147 million.

These trade figures are a testament of great and long standing bilateral relations between Pakistan and Italy. Despite Italy’s strong engagement in various trade sectors with Pakistan, textile till date remains the most promising sector of interest between the two countries and continues to grow at a good pace.

To foster trade and investment between Italy and Pakistan, this year, in June 2019, the Italian Consulate under the patronage of the Italian Embassy in Islamabad, in collaboration with DAWN Media group, Italian Trade Agency and Italian Development Committee organized a conference and exhibition ‘ITALY TO PAKISTAN’ on the occasion of the Italian National Day to celebrate the Italian excellence and presence of Italian companies actively engaged in Pakistan over the years. The conference aimed at promoting MADE IN ITALY products, goods and services in Pakistan and revered the contribution of local business houses in fostering trade relations between the two countries.

We look forward to increased interaction between Italy and Pakistan in the years to come and for Italy to become a major stakeholder in Pakistan’s industrial growth and development

Message of H.E. Stefano Pontecorvo, Ambassador of Italy to Pakistan on the occasion of Italian National Day 2019

The occasion of the Italian National Day has become an auspicious and welcome tradition, which allows me to highlight the general trends in our bilateral relations. I am very happy to be able to say that they have kept growing in all fields during the last few years. The political partnership between our two countries is based on shared values and interests and is carried out through a Strategic Engagement Plan which we are reinforcing. The growth and importance of our economic ties is testified by the numbers; we have more than doubled our trade and Italy is becoming an ever stronger investor in this country.

A growing number of large and medium Italian companies are coming to Pakistan in search of business and of partners, attracted not only by the sizeable internal market but also realizing the ideal location of Pakistan as a regional economic hub. We have strengthened our defense ties which has lead to a meaningful cooperation also in this field. On the cultural side we have intensified our activities and are organizing an increasing number of events meant to showcase Italy in Pakistan and the complementarities between our two countries and peoples. We are in the process of discussing a number of bilateral agreements that range from cooperation in enhancing our economic ties, to Archeology to the field of Universities and tuition.

Speaking of which it is also a great satisfaction to note the growing number of Pakistani students who choose Italy and Italian universities for their higher education. Finally, we must never forget the large Pakistani community in Italy, which is the second in Europe after the one in the UK and which acts as an authentic bridge, in all fields, between our two countries. In short, the present of our relations is excellent and the future even more reassuring.

Message of Mr. Aarij Iqbal, President IDC

Italian Development Committee "IDC" membership based business institution founded in 2009 under the patronage of ambassadors and Consul Generals of Italy to promote trade and investment between Pakistan and Italy. IDC is an association of professionals from different industries and works under the umbrella of Government of Italy and Government of Pakistan. IDC offers a wide range of services including; market research, sector analysis, direct marketing, seminars, conferences and trade exhibitions to facilitate trade and investment in both Italy and Pakistan which caters to the member/ business community's requirements.

According to Mr. Aarij Iqbal, President, IDC Pakistan, “We at the IDC, under the patronage of the Italian Embassy and the Italian Consulate, work as catalyst to enhance bi-lateral trade, fostering investments, exports and imports and cultural representation between Pakistan and Italy. Italy being the top 4th investor in Pakistan established diplomatic relations. In 1948 they shared common positions on the UNSC reform. Many Pakistanis have found their home in Italy which also led to the SEP (Strategic Engagement Plan in 2013) to deepen cooperation and cater under its umbrella; consular and immigration, political, security, defence, development, economic, scientific, cultural, energy and educational fields. We at the IDC take these cordial relations forward and encourage you for your feedback, suggestions, and queries and to be a part of the IDC family.”

“In my 25 years of affiliation with Italian companies and Italy I have developed many personal and professional relations and that bond has only strengthened over many visits these past years as President of IDC. I am especially grateful to Ambassador of Italy in Islamabad, H.E. Stefano Pontecorvo and Consul of Italy in Karachi, Ms. Anna Ruffino for their partnership on initiatives that are related to trade and investment between Pakistan and Italy.

The trade relations have seen tremendous growth and we have hit a new high in the last year and it continues to be promising for the coming years. We have had the opportunity to host delegations and speakers from Italian Companies and Experts have had the opportunity to reciprocate the same by taking delegations to Italy.

I look forward to further strengthening trade relations between Pakistan and Italy in the years to come.

References

  1. Association of Italian Textile Machinery Manufacturers (ACIMIT)
  2. State Bank of Pakistan
  3.  Trade Development Authority of Pakistan.


 

 
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