LAHORE, June 4: At the time when Pakistan is already losing export orders from its major traditional buyers like the UAE and Iran due to tough competition with India, Kenya – a major buyer of long grain rice – is planning to increase import duty from 35 to 75 per cent.
The export of non-basmati rice has already declined from 385,513 tonnes in July last year to 293,691 tonnes in April this year and that of basmati from 9,568 tonnes to 6,437 tonnes during the same period.
Increasing the duty on import from 35 to 75pc would mean restricting Pakistani rice by a tariff barrier in the times when trade balance is already in favour of Kenyan due to high imports of tea.
“Restricting imports of rice through increased import tariff means shifting the trade balance further to Kenya’s favour and endangering the livelihood of Pakistani farmers by snatching market from our exporters,” vice chairman of REAP Samee Ullah Chaudhry said.
He demanded the government to approach the Kenyan authorities to avoid imposing such decision that would halt rice imports from Pakistan, which is already facing a sharp decline. “We already have communicated our reservations to our High Commissioner in Nairobi, Rafiuzzaman Siddiqui, to take up the matter with the Kenyan authorities. We urged him to resolve the developing issue that has resulted in distress among exporters.”
Conventionally, Pakistan is one of the largest importers of tea, and has good trade relationships with Kenya. However, the measure of restricting rice imports may hamper the bilateral relationship.
“The Ministry of Commerce and the Trade Development Authority of Pakistan (TDAP) is doing nothing at this juncture when the country’s precious exports are already declining,” he said.
“Being the largest importer of tea, Pakistan can easily influence Kenya to allow its rice import on existing tariff. Kenya is a critical market for our rice exporters as it is considered as open market and remains available to them round the year,” Samee said.
The REAP vice-chairman said overall rice exports from Pakistan had declined as they have reduced by 7pc (basmati with 42pc decline and non-basmati rice with 5pc increase) in 2012-13 as compared to the same period last fiscal year due to multiple reasons, including severe power breakdowns, continued gas supply suspension and higher prices.
The export for 2012-13 is expected to be less than $2bn instead of increasing in comparison with $2.08bn in the fiscal year 2011-12. The major reason for such detrimental decline is the price instability of Pakistani rice in international markets that caused existing buyers to make their purchases from other cheap origins and international suppliers.
