August 6, 2003	Wednesday	Jumadi-us-Sani 7, 1424

ISLAMABAD, Aug 5: The European Union’s (EU) council has granted mandate to the European Commission (EC) to open negotiations with its trading partners to restrict the import of rice into markets of members countries.

EU’s current rice import regimes, therefore, being modified accordingly.

Well-placed sources told Dawn on Tuesday that major rice exporters had sought the government intervention to stop the move, which, they believed, would greatly harm the rice export to EU countries.

The EC would open formal consultation, a binding under the WTO regime, with its trading partners—US, Pakistan, India, Thailand and Guyana. These negotiations would take place over 90 days before they would reach conclusions, added the sources.

The sources said the EU wanted an agreement on the issue in the forthcoming ministerial conference in Cancun to seek imposition of quotas for different countries.

According to the sources, the EC would openly try to limit the flow of rice import into the EU member countries by imposing Tariff Related Quotas (TRQs).

Under the TRQs system, a quantity is earmarked for import against a particular rate of duty and further import of quantity over and above would be subjected to higher rates of duties.

These quotas could either be allocated to particular countries or might open for all, said the sources.

The EC had recently done the same on wheat from Russia and Kazakhstan, added the sources.

Giving its reaction on the issue, the Rice Exporters Association of Pakistan (REAP), a copy of which was made available to Dawn, said the move would also affect the Pakistani exports to EU. REAP proposed that Pakistan should favour status quo unless adequately compensated for any modification on withdrawal of current concession

because any change in rice import regime might abolish the abatement scheme under which Pakistan is entitled to substantial reduction in import duties on husked, brown super basmati rice and that would essentially lead to application of the bound rates of duty making Pakistani rice expensive to EU consumers.

Pakistan would not be in a position to receive substantial quota quantities under the TRQ system. They further said that if TRQs was established on the basis of past performance the quantities so far exported by Pakistan to the EU have not been significant and its historical market share being only 20 to 30 per cent.

The REAP proposed to the government that in order to improve rice export to EU, the EU might be asked to reduce the import duty on Pakistani milled white basmati rice to a maximum amount of euro 100/ton.