Promoting Exports Fourth, perhaps one of the biggest cost disadvantages relates to the interest rate on working capital of exports and for new investment in the export sector. Pakistan has the highest interest rate and even the rate on concessional financing is likely to be higher. Fifth, with the highest rate of inflation the rate of increase in local costs is likely to be the fastest. The authorities need to focus on ways to tackle the problems leading to and associated with low competitiveness. Otherwise, the prospects for exports in the near term are not encouraging. 16.5. Facilities and Incentives for Export Various export promoting polices have been adopted to boost exports such as devaluation of currency and a wide range of export incentives. Export incentives are popular and diverse in nature. In Pakistan, India and Bangladesh, export incentives are in the form of cash payments, lower income tax rate, concessional export financing, zero-rating of sales tax and export cash payments. Table 16.7: Export Incentives and Measures in Different Countries India Pakistan Bangladesh • Duty Drawback/Tax Exemptions on Yes Yes Yes Imported Inputs • Concessional Export Finance Yes Yes Yes • Export Insurance and Guarantees Yes Yes Yes • Export Quality Management Yes Yes Yes • Export Processing Zones Yes Yes Yes • Exports Performance Requirement Yes No Yes • Exports Cash Payments Yes No Yes • Export Promotion Organizations Yes Yes Yes Thailand Yes Yes Yes Yes Yes Yes Yes Yes Duty-Drawback Schemes: Pakistan’s duty drawback scheme is administered by The Federal Board of Revenue(FBR) and duty drawback rates set by FBR through the Input­Output Coefficients Organization. The duty drawback rates are low in Pakistan compared to India and Bangladesh. The largest part of the benefit goes to textiles exporters of clothing, followed by engineering goods and metal products. Export Finance and Guarantees: The export finance and guarantees in India are managed by The Export Bank of India and Export Credit Guarantee Corporation of India. The export finance in India is broadly divided into pre-shipment finance and post-shipment finance. The pre-shipment credit is available up to 270 days and credit against incentives receivable from Government is covered by ECGC Guarantee up to 90 days, while post shipment credit 159