LAHORE: An exorbitant increase in import tax on kinnow by Afghanistan’s Taliban government has worried local exporters of the citrus fruit who fear that another sector may collapse if Islamabad doesn’t take up the issue with Kabul at the earliest.
The Afghan government has imposed Rs33 per kg import tax on kinnow this season against Rs3.5 per kg of the previous year, says Shoaib Ahmad Basra, owner of a citrus polishing and grading unit at Sargodha, the heartland of kinnow fruit.
He says that there was a nominal import tax on the citrus in the Afghan market and the Ashraf Ghani government introduced Rs3.5 per kg tax only last year.
Mr Basra argues that even Rs3.5 per kg tax was unjustified because lower quality or B grade fruit, costing around Rs20 per kg, is exported to Afghanistan, while the Taliban government has pushed the levy up to whooping Rs33 per kg.
In contrast, he says, Pakistan imposes just Rs6 per kg import tax on consignments of pomegranate, grapes and apple from Afghanistan, while the market rate of each of the three fruits is over Rs100 per kg here.
Pakistan exported 85,000 tonnes of kinnow to Afghanistan last year (2020-21), 32 percent less than the previous year (2019-20). The total citrus exports in the 2020-21 season stood at 0.44 million tonnes.
Mr Basra, as Sargodha Chambers of Commerce and Industry president, had called on President Arif Alvi in Islamabad along with a delegation the other day, seeking help of the Presidency to raise the import tax issue with Afghan government, as well as to open the Iranian market for citrus exports at the earliest.
Foreign Minister Shah Mahmood Qureshi, after his recent visit to Tehran, had announced that the Iranian government had agreed to opening its markets for the Pakistani citrus. However, there had been no progress on the issue since then.
Mr Basra claims that Tehran is dilly-dallying with regard to issuance of citrus export permits and urges Islamabad to play a proactive role for resolving the issue before it is too late.
He says if export permits are issued in time, Pakistan can export at least 60,000 tonnes of kinnow this year.
In the past, Pakistan had been exporting up to 125,000 tonnes of citrus to Iran. Muhammad Hanif Hanjra, a kinnow grower, fears the growers will suffer financial losses if the issues related to Afghan and Iranian markets are not resolved at the earliest because exporters and kinnow polishing and grading factories will offer them reduced rates. In case the exporters suffered losses, they may also default on payments to growers, he warns.
According to him, kinnow orchard owners are already under stress because of a 40 percent drop in the fruit production this year owing to climate change and other factors and the government should take up the import tax issue on an emergent basis to save them from financial collapse.
Published in Dawn, December 6th, 2021