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Govt, businessmen coordination must on future import, export policies; growth in value added products lacks ideas

Govt, businessmen coordination must on future import, export policies; growth in value added products lacks ideas

Interview with Mr Anis Majeed – Chairman, Bombi’s Group, Karachi Wholesales Grocers Association (KWGA)

Profile:
Mr Anis Majeed is Chairman of Bombi’s Group and Karachi Wholesales Grocers Association (KWGA). He has been active managing committee member of Karachi Chamber of Commerce and Industry (KCCI). He is also General Body member of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on behalf of Rice Exporters Association of Pakistan (REAP). He has been in pulses (commodities) business for more than 35 years. Anis Majeed and his brothers took over business from their father who established pulses processing plant for more than 50 years ago. They have been maintaining the business and started Indenting and have been in import and export of pulses (commodities) since 1985.

PAGE: Share your views on the import and export duties and their impact on the traders:

Anis Majeed: Import and export duties are key factors by which government earns revenue, controls imports and exports along with smuggling of commodities. High duties levied on import of commodities open doors for smuggling and under-invoicing and the effect of this is directly transferred to common man in terms of higher commodity prices and revenue loss to the government. In the same manner if export high duties are levied, that not only damages export but also inward flow of foreign exchange. Government should regularly discuss with traders and concerned stakeholders on the imposition of trade policies before imposition of any import and export duties. Government and businessmen should be in proper coordination to set up policy for imports and exports.

Import of luxury goods to Pakistan needs to be curtailed since these products are not our necessity and we will have no problem in case we curtail the import. The products, which are not necessity products should not be allowed to be imported to save foreign exchange and for the balance of import and export trade. Levying additional duties is not the solution for reduction in import. In fact to increase export, incentives should be given.

PAGE: Could you tell us about the import of pulses during current year?

Anis Majeed: Pakistan’s major pulses crop is desi chickpeas whose production is around 600,000 mts per annum. For last two years, Pakistan’s production of desi chickpeas has been affected and production is quite low compared to our average consumption of 750,000-800,000 mts annually. Last year, Pakistan’s local production of desi chickpeas was estimated to be about 225,000-250,000, which proved wrong and actual production was 359,000 mts and the imported quantity was about 420,000 mts. We had some carryover stock, which was available due to over import earlier. Again due to excess of imports and our local market is selling below their imported cost. Major factor of heavy imports was due to lack of rain. Our local production was not sufficient enough to meet our local consumption demand. As far as lentils are concerned, our annual consumption is about 125,000 mts, while our local crop production is only 64,000 mts (as per Pakistan Bureau of Statistics).

Last year we imported about 170,000 mts, which was almost double of the consumption locally. Therefore local market price went down in the wholesale market. A lot of cargo was imported from Canada and Australia by importers to bridge this gap, which is still stored in warehouses and is being regularly consumed until new crop arrives. Other pules were not in any loss making zone since production and import were almost equal to the consumption. The impact was only the international market which went down because of some duties levied on import of desi chickpeas by the Indian government. India put ban on import of some items like black matpe. Since India is the biggest importer, these measures had great impact on international market price.

 

PAGE: What should Pakistan do to be self-sufficient in the production of pulses?

Anis Majeed: Pakistan was once known as agrarian economy, however, now Pakistan has become service-based economy as per the GDP composition. It is high time for Pakistan to take measures to improve its production of pulses and other commodities. Pakistan has the capability, infrastructure and land available to improve local production of crops. Government needs to support farmers by investing in Research and Development, farmer’s education on increasing yields, crop rotation and storage of grains and cereals, and usage of fertilizers and pesticides specially giving easy loans to farmers to purchase machinery and to create silos for storage. Without improving on our agricultural produce, we are putting heavy burden on our economy and losing foreign exchange. If we get self-sufficient, we can also work towards exports of excess produce and earn foreign revenue instead of facing trade deficit. Improvement in agriculture will lead to industrialization and this will lead to more export which is need of the hour and it will bring foreign exchange for the country which is important for the prosperity of the country.

PAGE: Your views on the trade outlook of Pakistan in 2018:

Anis Majeed: Pakistan is a land of opportunities. Pakistan has been facing trade deficit for many years because of unbridled imports of products along with luxury products and every year we face difficult times in improving exports. International markets are getting competitive and all regions are working really hard to improve their productivity and export market by innovating value-added products. It is high time that every Pakistani worked for the betterment of Pakistan. We need to take measures to create value-added products in Pakistan and explore international markets. We must make Pakistan a peaceful place where international investor may feel safe to invest money.

PAGE: Your views on the purchasing power of the Pakistanis during last five years:

Anis Majeed: Purchasing power of a common man has been reducing with every passing year. Inflation has been high and income levels have not been able to match the pace. Government needs to take measures to provide essential facilities of food, water, education and housing to the needy. The government needs to develop an environment to facilitate local industry and promote new industry to utilize our youth and give employment.

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