Suchergebnisse

The main purpose of this study is to supplement the empirical
findings of an earlier paper by the author on the domestic prices of
imports in Pakistan [8]. In order to determine the factors which
influence the prices of imports in Pakistan, some selected commodities
were studied in the earlier paper and it has been found that, due to the
presence of direct controls on supply, the im¬ porters could earn an
excess profit and the licensing system was the main deter¬ minant of the
domestic prices of imports at the margin. Changes in duty levels did not
have any effect on domestic prices up to a limit defined by the extent
of the excess profit" " Since the study cited was completed, there have
been some significant changes in the import policy of Pakistan.
"Liberalisation" of imports was broadened with the expansion of the
"free list". In Section I of this paper an attempt has been made to
determine the effects of free list imports on the supply and prices of
imports, and on the mark-ups of importers.

Imports play a key role in the economy of Pakistan, especially
since they provide a large share of the nation's industrial raw
materials and most of its capital goods. Scarce foreign exchange is
rationed and allocated among different types of commodities through an
elaborate licensing system. To cope with the needs of the economy there
has been liberalisation of imports in recent times. Proposals for
further liberalisation and alternative proposals for rationing foreign
exchange through an import surcharge system or an exchange auc¬tioning
system have also been put forward. But, in the absence of empirical
evidence regarding scarcity value of foreign exchange and the domestic
prices of imports, the impact of these changes on the import sector and
there from on the economy could not be definitely estimated. Different
assumptions have been made regarding these magnitudes resulting in very
different conclusions about the impact of various policies. A study of
the facts is necessary under these circumstances, and so we have
embarked on an empirical study regarding the determinants of the
domestic prices of imports.