LAHORE - Unless level-playing field is provided Pakistan cannot benefit from granting most favoured nation (MFN) status to India, observed rice exporters.
“If you import Indian rice into Pakistan the duties and taxes are just around 14 per cent but if Indians import Pak rice the duties are more than 70 per cent. Secondly Indian farmer is heavily subsidized and costs of fertilizers are much less than in Pakistan. The difference of US$ exchange rate is also in favor of India.
Market sources told The Nation that bilateral trade with India in rice would knock our farmers out of the competition.
“For that, we recommend that import of rice from India for local consumption with in Pakistan is countervailed by imposing countervailing duty in proportionate to the difference of subsidized inputs available by Indian farmers.”
The exporters said that for any imports of Indian rice for Re-export purposes, a DTRE (Duty and Tax Remission for Exports) scheme should be allowed which would help Pakistani exporters avoid countervailing and other duties and would keep us price competitive in international markets. The DTRE scheme should only be allowed on imports of Indian rice for re-exports purposes only with minimum 10% value addition. The DTRE Scheme would ensure increased export volumes up to USD-3.5 billion plus and would in turn help gain higher foreign exchange to our country, they added.
They said that the DTRE scheme to be applicable from January till September each year while should remain suspended during the Paddy harvesting season (October – December). The suspension of DTRE scheme (October – December) during the Paddy harvesting season would ensure that our rice millers / exporters support farmers through local paddy buying during the seasonal days.
REAP former vice chairman Samiullah Chaudhry suggested that trade of rice should be allowed through Wagha border on immediate basis. High Quality Indian Basmati Rice is grown just 30-KM away from Wagha Lahore, transporting it from Amritsar through Lahore to Karachi Port is time and cost efficient. It is highly opportunistic to import Indian high quality basmati rice from Wagha to Lahore under DTRE and re-export it with value addition through Karachi. This would increase our exports volume, resulting in gaining higher foreign exchange and controlling Indian basmati rice market globally.
He said that the DTRE would ensure introduction of FDI, employment, capacity building, R&D and agriculture developments on latest technological grounds.
Samiullah Ch said that Pakistan rice industry has grown over 500% during past 3 years while the crop size has remained stagnant at 6 million tons over the period. The millers have managed to build the capacity to process 9 million tons of Rice which is 3 million tons more than the available crop in Pakistan. Due to availability of fewer paddy, millers are striving for grains; the milling capacity is underutilized and hence causing losses to the industry.
“We need to increase our crop volume or to provide our industry access to higher volumes of paddy/rice through imports. We expect that through normalization of regional boundaries, the prices of Pakistan basmati would match to that of higher Indian prices and therefore, farmers would get more benefit from their produce.”