Abstract
Demand for wood is increasing with the rapid population growth in
Pakistan. To cater for this rise in demand, Pakistan Government has
decreased import duty on wood and products of wood in the country
from 16 to 11 percent in finance bill of 2017.With this backdrop, this
research quantifies the impact of reduced tariff duty of wood at
household level and economy wide by applying Commutable General
Equilibrium model. MyGTAP model is standardized by applying GTAP Data
base and latest available Social Accounting Matrix of Pakistan. This
updated economic trade model is tailor made model for these types of
analysis. The result shows an increase in wood imports by US$ 41million.
There is a positive impact on Real GDP, household income, but Pakistan
government income will decrease by 0.08 percent due to reduction in
tariff. Household analysis revealed that rural small farmers and non-farm
workers’ timber demand in Pakistan will escalate by 10 percent in
relations to other communities. Policy makers and planners can best
utilize these results in planning and implementation process for
improving effectiveness of policies.
