LAHORE - Banks are no more opening letter of credits (LCs) for export of goods, including rice, to Iran but India is having no such issue and continues to have good trade ties with Iran at state level despite US opposition. Resultantly, Pakistan and Iran official trade is at halt since United States has put economic sanctions on Iran.
“We need to take some measures to continue this trade, including Currency Swap Arrangement, Barter Trade Arrangement and LC Transaction Arrangement with Iran, as rice export to Iran has plunged significantly due to ban on export to Iran, observed REAP acting chairman Ch Samee Ullah.
Addressing a Press conference on Monday, he pointed out that Iran is one of our biggest buyers since years and we have lost that market segment in past years. Indians are benefiting from Majarah Exchange rate ($1 = 12,260 Riyals) due to availability of official channel though Pakistan has to transact on Azad Exchange Rate ($1 = 34,000 Riyals) hence making us price ineffective.
He said that overall exports of Basmati in July- October 2012 also plunged 52 percent to 168,000 tons from 353,000 tons in the year agro period. Exports of non-basmati varieties fell to 121,000 tons in October this year from 184,000 tons in October last year. And in July-October 2012, exports of non-basmati rice also declined to 333,000 tons from 531,000 tons in the same period of 2011.
He expressed appreciation to Makhdoom Amin Fahim, Federal Minister of Commerce, Muneer Qureshi, Secretary Commerce and Abid Javed Akbar, CE, TDAP for incorporating the Mandatory Membership of Rice Exporters Association of Pakistan into Recent Strategic Trade Policy Framework (2012-15).
He said that with the suspension of Mandatory Membership since 23rd April 2012 through a Public Notice by Mincom, REAP was pulled to become a Rich Men Club so that Voice of Small Exporters is snubbed and Larger Exporters share the major chunk of the trade through formulation of self caused policies. The restoration of Mandatory Membership of REAP has acted as a resort for the Small & Medium Sized Exporters and has given them their due representation.
He said that the mandatory membership of REAP also works as a safeguard of the unanimous rights of Pak Rice Exporters.
Replying to a question, he said that QRC which used to be a Quality Review Committee to facilitate the exporters of quality Basmati rice has transformed into sheer ruthless inspection body where there is no concept of facilitation. The staff behaviour has changed from “A Facilitator for Quality Exporters” to “An Inspector Ensuring Quality”.
With the sequence of events, it seems as if TDAP was not willing to carry along the smooth operational structure of QRC and liked to uproot the whole structure.
“I like to mention that there is no mandatory Pre-inspection by govt on textile exports, surgical exports etc. Moreover, top three rice exporting nations including India, Vietnam and Thailand have no obligatory inspection structures on their rice exports.”
“If the structure of QRC is not revived, as before, we are forced to take stringent action and demand abolishment of QRC on immediate basis.”
He said that Pakistan has much higher discount rate compared to our regional competitive countries like India, Bangladesh and Sri Lanka hence knocks our exporters out of the global competition. For that, we request State Bank of Pakistan to reduce the discount rate specifically for the export oriented industry.
He said that REAP has no representation in the EDF Board despite being 2nd largest association and 2nd largest foreign exchange earner contributing over $2 billion to national exchequers for last 4 years consecutively. “We request Makhdoom Amin Fahim to accept our prerogative to EDF Funds and co-opt Chairman/Vice Chairman REAP on the EDF Administrators Board.