Pakistani exporters express concerns about free trade with India

[Safriz]

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[Safriz]

KARACHI: Pakistan’s agriculture exporters have expressed concerns
over free trade with India under the most favoured nation (MFN)
status as they believe that it will adversely affect the country’s
exports, sources said on Wednesday. CEO Harvest Tradings Ahmad Jawad said Pakistan could greatly benefit
from the import of agricultural produce such as wheat, spices, tea and
other edibles to meet production shortfalls at competitive prices.
Jawad said that although restrictions on trade and an uncertain
political situation affected official trade with India, unofficial trade
continued through the Kashmir border, particularly in agricultural products. “India is a vegetarian country by a wide margin. In this respect, the
Pakistani vegetable and fruit market has a lot of trading potential with
India,” he said. President Farmers Associates Pakistan Dr Mohammad
Tariq Bucha said that they were not against trade with any country
but trade with India should be on a level playing field. “Indian agriculture is highly subsidised and ours is highly indebted,” he
said. There are heavy taxes on agriculture input in Pakistan and GST is
collected in advance, which does not happen in any other part of the
world, he said. “India’s power for agriculture use is free, while cost increases in
Pakistan due to lifting underground water, as canal water is short,” he
said. Moreover, price of urea is approximately 50 percent higher in
Pakistan and diesel prices are also higher by approximately Rs32 per
litre. “India gives finance at six to seven percent mark-up while we receive
finance at 17 percent,” Bucha said. Bucha suggested that the
government should also include stakeholders in the policy making. “If India wants to become a favoured nation, it should release some
water from Sutlej and Ravi rivers and prove that Pakistani farmers are
brothers of Indian farmers,” he said. Stakeholders of Pakistani rice fear
the influx of Indian rice as only five percent duty exists on imports of
rice in Pakistan while India has imposed 80 percent duty on its import. Granting MFN status to India threatened Pakistani rice growers and
traders with the arrival of Indian rice in Pakistani markets, said
President Basmati Growers Association Hamid Malhi. “We are not against MFN status being given to India but we want a
level playing field otherwise our trade will suffer huge losses, as there
is no comparison in import duty of the two countries,” he said. Despite
depreciation of the value of the Pakistani rupee, business has not
picked up mainly because of a simultaneous depreciation of the Indian
rupee and increase in the domestic cost of production due to increase in prices of seed, fuel, fertiliser, insecticides, pesticides and farm wages. Vice Chairman Rice Exporters Association of Pakistan Safdar Mehkri said
that India had affected their exports to the Middle East and Gulf
countries as it was selling rice at cheaper prices as compared to
Pakistan. Iran was a big market for Pakistani rice but due to
international sanctions trade was affected. Payment became an issue
because banking structure was not available, he said. Pakistan grows approximately 6.25 million tons of rice, which had
increased from five million tons during the last 10 years. “Increase in
the crop size shows that farmers are getting benefits despite the fact
that input cost increased many times during this period,” he said. President Union of Small and Medium Enterprises (UNISAME) Zulfikar
Thaver said the SME rice exporters were put out of business due to an
increase in prices in finer varieties in the local market while shippers
were not securing orders. At this rate, rice exports would suffer and unless the cost of production
was reduced growers would not be in a position to lower the prices to
enable exporters to compete with India, he said. Pakistani farmers say that India is far ahead of Pakistan in technology.
Jawad said that Indian farmers were far more educated than Pakistani
farmers. Their decisions were usually timely and effective, he added. “The major reason for this success is the IT industry that has placed
India high on the pedestal of the international business community,”
he said. India could become a large market for Pakistani oranges.
According to an estimate, Pakistan can export 400,000 tons of these to
India, annually. This export would fetch $1.2 billion in the next two
years. India is also the largest importer of Pakistani dates. Last year India imported dates worth three billion rupees and Pakistan could
raise this by an extra billion quite easily, he said. Pakistan can export products such as cotton yarn, chaunsa mango and
vegetables to meet the Indian demand.