Bureaucratic red tape results in Pakistan losing potential export markets

By Kazim Alam, The Express Tribune

KARACHI: It is a typical case of businessman-proposes-bureaucracy-disposes. While international sanctions on Iran brought down Pakistan’s mango exports by no less than 30,000 tons in the current season, fruit exporters insisted that the typical bureaucratic tardiness resulted in Pakistan losing at least three potential mango export markets this year.

Pakistan was unable to export mangoes to the United States, Australia and Japan in 2012 mainly because the bureaucracy failed to resolve procedural glitches in time, costing the national exchequer millions of dollars, they claimed.

Exporters of mangos had set the volumetric target of 150,000 tons for the current season. Exports fell short by 23%, as the exported quantity of Pakistani mangoes was only 115,000 tons. Similarly, while exporters expected that selling mangos overseas will bring $50 million to the country, the actual revenues were only $39 million – 22% less than the original target.

“Although we have technically been allowed to export mangos to the US on a commercial basis for two years now, we could not export even a single kilogramme of mangoes this year,” All Pakistan Fruit and Vegetable Exporters, Importers and Merchants Association (APFVEIMA) Chairman Waheed Ahmed told The Express Tribune in an interview.

Pakistan failed to export mangoes to the US market because Americans insisted that each mango shipment should first arrive in Chicago, undergo treatment at a local irradiation plant, and then be taken to other parts of the country. Fruits are treated with gamma radiation at an irradiation plant in order to preserve them.

“I have repeatedly asked local authorities to set up an irradiation plant here in Pakistan to ensure our mango exports to the US,” Ahmed said. “One, there is no direct flight from Pakistan to Chicago. Two, it does not make sense to take a product to Chicago if it was supposed to be sold in Houston. It makes the product expensive, especially when it can be treated in Pakistan,” he said.

Noting that all government officials apparently approve of his proposal, he said little progress had so far been made in this regard at the policy level. He added that representatives of his association also met the US consul general in Karachi during the recently held Expo Pakistan 2012 exhibition to discuss the issue.

As for the export of Pakistani mangoes to Australia, Ahmed said that the government had yet to frame a document listing all the standard operating procedures (SOPs) that an official Australian delegation requested in earlier in June.

The delegation from Australia visited orchards and fruit processing factories in Pakistan five months ago and requested that the Pakistani government should come up with SOPs to facilitate mango trade between the two countries. Had the said document been submitted in time, he noted, Pakistani exporters would have sent mangos to Australia on a trial basis this year, which would be followed by exports on a commercial basis in 2013.

“About half a million people in Australia are originally from South Asia. Moreover, their winter season kicks in when we still have summer in Pakistan, which means there is lots of export potential for Pakistani mangoes in Australia,” he said.

According to Ahmed, Japan is a low-volume, high-value market, with up to $6 per kilogramme market potential. But the Japanese government insists that Pakistan should subject its mangoes to vapour heat treatment (VHT) before exporting them to Japan on a commercial basis. “The government has yet to set up a VHT plant to enable Pakistani exporters to sell their fruits in Japan,” he said, adding that the Japanese market alone could contribute up to $10 million in Pakistan’s annual mango exports.

The establishment of a VHT plant in Multan had been approved under the Export Development Fund, but the APFVEIMA is opposing the proposal. “We think that the proposed plant should be set up in Karachi, as 70% of exports are carried out from here. There should surely be a VHT plant in Multan, but we think the first of such facilities should be built where it is most needed,” he stated.

Published in The Express Tribune, October 14, 2012.

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