Talat Mahmood, Acting President and Junaid Makda, Vice President, Karachi Chamber of Commerce and Industry (KCCI) and Mohsin Saify, Chairman Pakistan Tea Association (PTA) and members PTA, in a joint press statement, have urged the government to address the aggravated situation of tea industry due to heavy smuggling, and the situation arising after signing of the ATTA.
KCCI and PTA warned that if the existing trend of smuggling continues, a very difficult time ahead is foreseen, wherein tea business would be wiped off. They said the commercial import of tea for trading is virtually non-existent (ratio 50:50; legal imports - 88,871 metric tons, through ATTA - 87,557 metric tons), while tea blending and marketing companies are facing a real tough time 'as every second cup of tea taken in Pakistan is smuggled'.
They further said that the high duties/taxes imposed at approximately 42 percent pave the way towards tea smuggling. They called upon the government to reduce levies to 20 percent. Reduction in import duties/taxes would rationalise smuggling, channelize and document tea business, reduce retail price of tea, broaden tax base and generate economic activity, they added.
KCCI and PTA pointed that the government is aware of the serious repercussions by of illegal tea trade and previously, has directed FBR to reduce import duties to discourage smuggling, however, no action was taken in this regard.
They called upon the government to look into the 'negative list' for ATTA, which is now left to only few items. Tea, electronics, cosmetics, tyres and a number of other Indian goods, whose import Pakistan prohibits or impose heavy duties on, get popular on Afghan transit-trade imports. The trend is a big threat to indigenous industry and would hold severe impact if the list is not revised and proper monitoring of the trucks in transit through ATTA is not done, they concluded.-PR