Visiting Pakistan Tea Association Chairman Muhammad Altaf said he was hopeful that reduction or removal of import duty on Indian tea would reduce illegal tea exports to Pakistan through Afghanistan route.
At present, countries like Kenya, India, Rwanda, Indonesia and Vietnam, who export tea to Pakistan, have to pay 10 percent import duty.
India, which exported about 9.3m kg of tea to Pakistan in 2005, wants withdrawing duty on tea imports to become cost competitive. Altaf, leading PTA delegation had talks here with members of Indian Tea Association (ITA), Tea Board, merchant, exporters on increasing trade between two countries.
The PTA chairman raised question on high price of Indian tea, particularly north Indian tea. "Kenyan price is much lower than Indian tea. Average Kenyan tea is priced at $1.7 per kg whereas average Assam tea costs $2 per kg,' he added.
Pakistan, which requires 170m kg of tea to meet its domestic consumption, will import nearly 90m kg of Kenyan tea this year. Nearly 130m of tea enters through legal route and rest 40m kg is smuggled into the country.
India made three suggestions to PTA delegation. PTA and ITA will work hand-in-hand to remove import duty on Indian tea under South Asian Free Trade Agreement (Safta).
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