06 -12, 2002
TEA SMUGGLING ON RISE
Tea trade leaders want prompt remedial measures to
check smuggling, otherwise, they fear, volume of smuggled tea will go
up to 50,000 tons from the current 32,000 tons.
"The best way to curtail the quantum of
smuggling is to reduce the customs duty on imports by 15 per
cent," chairman Pakistan Tea Association (PTA), Mohammad Hanif
Janoo told a press conference at a local hotel on Saturday.
He said smugglers are currently enlarging their
distribution network without check from any agency. As a result of
this, the smuggled tea is arriving into Karachi in a very large
quantity daily by full truckloads through Quetta.
Afghanistan mainly consumes only green tea, being
imported from China, Indonesia, Vietnam, etc., and orthodox black tea
from Sri Lanka, Indonesia and India. All the CTC teas imported by
Afghanistan from Kenya and other origins are meant for dumping into
Pakistan, he said.
An estimated 32,000 tons of tea was smuggled into
Pakistan in 2001 as compared to 24,000 tons in 2000 and 21,000 tons in
1999. Genuine imports in 2001 were 105,000 tons as against 111,000
tons in 2000 and 112,000 tons in 1999. Tea consumption pattern in
Pakistan has been rising since 1999 from 133,000 tons to 135,000 tons
in 2000 to 137,000 tons in 2001.
Janoo said in just three months, January-March,
10,000 tons of tea has found way into Pakistan through illegal
Even if the government, he said, cuts the import
duty in 2002- 2003 budget by five per cent, genuine imports will surge
to 125,000 tons as compared to 105,000 tons. The Association has urged
the Commerce Minister Abdul Razak Dawood on April 24 to cut the import
duties to 15 per cent from the current 30 per cent.
PRICES EASE ON IMPORTS, LOCAL SUPPLIES
The burden on consumers had slightly eased in the
last one month as they paid lesser to buy regular kitchen items thanks
to uninterrupted supplies of the local crops and imports.
Poultry products, however, turned out to be the
sole burden on consumers as their prices rose despite low demand and
rising heat wave. Egg prices went up to Rs22 per dozen from Rs19.
Poultry live bird prices surged to Rs50 per kg from Rs49 per kg while
the chicken meat is selling at Rs85 to Rs88 per kg from Rs80 per kg.
A monthly price survey (from May 1 to April 1)
showed that the prices of onion dropped to Rs12-13 per kg from Rs18-20
per kg following imports from India and Iran and arrival of
Balochistan crop. Around 4,000 tons of onion have been imported from
In wholesale markets, onion was selling at Rs9 per
kg as compared to Rs12 to Rs 13 per kg.
PAKISTANI COS SET TO START OPERATION IN HFZ
About two dozen Pakistani companies are well set to
commence their industrial production and commercial operations in the
Hamriyah Free Zone in Sharjah, UAE.
Hamriyah is the tenth free zone in sequence to be
set up in UAE and second in Sharjah. It is a next generation free zone
and offers incentives that far exceeds those given by other free zones
in the area. Since commencement of its operations in October 1998 it
has attracted an investment of 500 million dollars from 210 companies
set up by investors from 19 countries.
"We offer a one-window operation and a
completely hassle free environment in Hamriyah," Engineer Rashid
Al Leem, Director General of the Hamriyah Free Zone Authority,
informed on Saturday (April 27). The investors are from the US,
Europe, South Africa, India and many parts of the world who throng UAE
— a thriving business centre of the world that can be compared to
the Asian Tigers.
BUSINESS GROWTH SHRINKS WITH INCREASED TAXES
In rich states, taxes are lowered to pull economies
out of recession or when the initial signs of a slow-down appear. And
emerging economies like Pakistan need investment-oriented taxation
policy to spur economic growth and reduce poverty.
As budget deficits become unmanageable,
governments, however, tend to opt for revenue-oriented taxation whose
yields decline when investment and growth stagnates. Both the growth
and the tax revenue potentials are thus not realized. This is the
situation that prevails now in Pakistan.
EXPORT FINANCE RATE UNCHANGED
The exporters will continue to get export finance
from the banks at a maximum markup of 8 per cent in May 2002 as the
State Bank of Pakistan has left the export refinance rate unchanged at
6.5 per cent.
The banks give export finance to the exporters at a
rate 1.5 per cent higher than the rate at which they get export
refinance from the SBP.
In April, the central bank had increased export
refinance rate by 50 basis points to 6.5 per cent. An SBP circular
issued to all banks on Saturday said the SBP would keep the rate
unchanged for May 2002.
ASIAN BANK TO FINANCE STUDY ON EPB
The chairman, Export Promotion Bureau (EPB), Tariq
Ikram said Saturday that Asian Development Bank (ADB) will conduct a
study for the restructuring of the Bureau.
He was addressing the members of the Karachi
Chamber of Commerce and Industry (KCCI). Ikram said that a foundation
has been laid for a new EPB in the country during the past one and a
half year. He said ADB will finance the study on EPB for further
improving its performance.
The government is likely to levy five per cent
customs duty on import of raw wool and raw cotton from the financial
year 2002-03. Well-placed sources told on Saturday that the decision
was expected to be announced at the forthcoming budget for 2002-3.
These items are currently imported at zero rate of customs duty.
When contacted, customs officials said that it was
not decided to levy tax on these items, but the same were under
consideration. They said that there was a proposal to levy customs
duty on these items to boost its exports.