Ban on luxury items’ import welcomed: BMP chief advocates controlling burgeoning food import bill

LAHORE: The Federation of Pakistan Chambers of Commerce and Industry’s Businessmen Panel (BMP) Chairman Mian Anjum Nisar, terming the ban on import of luxury items as necessary, stressed the need for also taking serious measures to control burgeoning food import bill to help boost the country’s faltering economy, as Pakistan’s oil and eatable import bill has surged by almost 60% to near $25 billion in the 10 months of the current fiscal year.

The FPCCI former president said that the rising food imports and the resultant trade deficit should also be taken care by the authorities, as the country has spent over $8 billion on the import of edible items in the last fiscal year.

To bridge the food production gap, the food import bill surged by more than 12.30% to $8 billion in 10MFY22 from $7 billion in the same period last year. The import bill might go up further in the coming months because the government continued to allow importing wheat and sugar to build strategic reserves.

The BMP Chairman observed that the economic managers will have to chalk out a long-term plan for import substitution and increasing exports so that Pakistan could become self-reliant.

He also emphasized the need for the adoption of international best practices for priority sectors and consultations with international experts to achieve success. He stressed upon the need to enhance inter-ministerial coordination and public-private partnership for increasing exports.

The country’s overall import bill increased by 47% to $65 billion in 10MFY22 compared to $44.73 billion in the corresponding period last year. The share of these products in the total import bill also rose to 38% in 10MFY22. The steady increase in these two sectors’ import bills is causing a trade deficit and putting pressure on the government’s external side.

Referring to the data released by the Pakistan Bureau of Statistics, Mian Anjum Nisar stated that the import bill of oil increased by over 96% to $17 billion in 10MFY22 from $8.69 billion over the corresponding months of last year. Further break-up showed that the import of petroleum products went up by 121.15% in value and 24.17% in quantity.

Within the food group, the major contributions came from wheat, sugar, edible oil, spices, tea and pulses. Edible oil imports witnessed a substantial increase in both quantity and value terms. Due to rising world prices, the palm oil import bill grew by 44.64% in value in 10MFY22 to $3.09 billion from $2.14 billion in 10MFY21.

As a result, the domestic prices of vegetable ghee and cooking oil also went up, the import of soyabean oil increased by 101.96% in value and 9.30% in quantity in 10MFY22 from a year ago. Wheat imports, on the other hand fell 19.12% to 2.206 million tonnes in 10MFY22, from 3.61m tonnes in 10MFY21. Sugar imports increased by 49.52% to 311,851 tonnes in 10MFY22, compared to 280,377 tonnes in 10MFY21. The import bill of pulses, tea, and spices also grew rapidly during the period under review.

The chairman of the BMP, the ruling group of the FPCCI, said that the situation is in control due to sustained increase in remittances.

Copyright Business Recorder, 2022