Potato import may cost over $60m
Published: May 09, 2014
KARACHI: The imposition of 25 per cent regulatory duty on potato exports and making its import at zero per cent have yet to make the vegetable cheaper in domestic markets.
The government issued two statutory regulatory orders (SROs) on May 2 to fix regulatory duty on potato exports at 25pc. On the same day, another SRO was issued stating that no regulatory duty and other levies would be charged on import of 200,000 tonnes of potatoes from May 5 to July 31.
The government is trying to keep duty-free import of potato till July 31 to curb prices in Ramazan, starting from end of June.
The issue of removing duty on imports and fixing regulatory duty on exports had been in news for the last many days, but consumers have continued to pay Rs50 per kg for one of the most sought-after edible items. Retailers blamed lingering high wholesale price of the main staple food at Rs45 per kg.
However, the government has claimed that the country had surplus stocks of 1.1 million tonnes of potatoes lying in the cold storage. But retailers and wholesalers said that more than 500,000 tonnes of potato had already found way to Afghanistan and Iran through informal channels, thus rising prices in local markets.
Importers and market traders are reviewing options to import potato from various countries after the government’s decision on imports.
Waheed Ahmed, the co-chairman of All Pakistan Fruit and Vegetable Exporters, Importers and Merchants Association, told Dawnthat in case import is made by sea from India, potato would cost Rs38-42 per kg keeping in view rates of $375-425 a tonne (C&F).
Imports by road through Wagah border from India would definitely be lower at $300 a tonne (C&F), around Rs30-34 per kg. “In view above price in India, the import bill of 200,000 tonnes of potato till July 31 is estimated at $60m-80m based on one dollar value of around Rs100 in the inter-bank market,” he said.
Ahmed claimed that some 80 trucks loaded with potato had arrived at Wagah border in the last three days in which the landed cost was Rs30 per kg. It was sold at Rs38 per kg in Lahore’s wholesale market after adding transportation and other expenses. One truck was carrying a load of 10-12 tonnes.
He said importers and traders would also examine Chinese import option where new crop would arrive in the next 10 to 15 days and shipments take 18 to 22 days to reach Pakistan. Imports from India arrive in Pakistan in five to seven days while transit time from Bangladesh is 16 to 18 days.
Communication with the exporters of India, Bangladesh and China was under way to see the possibility of imports from these countries, he said, urging the government to keep a check on the Iran and Afghanistan borders so that Pakistan’s cold storage stocks and imported potato should not reach there in the garb of smuggling.
The government, he said, should devise a policy now that it should not hurt the interest of growers. To ensure a reasonable price, the government should fix Jan 1 as the date of harvesting of potatoes for growers so that immature potatoes do not find their way into the market.