In a first, Pakistan earns $6.2m through cigarette exports

Although Pakistan has been exporting tobacco raw material, this is the first time the country exported finished products

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ISLAMABAD: By exporting cigarettes (finished product) for the first time, the country has earned at least $6.28 million in the past 11 months of this financial year (FY20).

However, the exports could not be accelerated as per the expectations; gulf countries had placed import orders of cigarettes worth $50 million last year.

According to documents available with this scribe, the revenue of $6.28 million during July-May FY20 was the country’s first-ever major earning from the export of value-added tobacco products.

Although Pakistan exports tobacco (raw material) to various countries, this was the first time that the country exported finished products, a step which experts believe would help the country capture more markets and earn better returns in the future.

As per the data, there was “zero export of cigarettes in FY19”, whereas highly negligible quantities of some tobacco products were exported in FY18, FY17 and FY16, amounting only to $50,000, $92,000 and $78,500, respectively.

It is pertinent to mention that Pakistan Tobacco Company (PTC) had last year received an import order of cigarettes from gulf countries, particularly Saudi Arabia.

“The importing country, after placing the order, had changed its standards for cigarettes, which ultimately caused a delay in the export of the product from Pakistan,” a PTB official said, adding that PTC had later started exporting cigarettes after meeting the new standards of the Arab country.

According to the official, “Many cigarette manufacturing plants in Khyber Pakhtunkhwa were established in 1960s’ and 70s’, following which the importers had asked us to upgrade the quality of tobacco, paper, filters, packaging etc. These requirements have now been met successfully and we are expecting a massive surge in the export of cigarettes to Middle East countries from this year.”

During the past 11 months, Pakistan collectively exported tobacco worth $38.12 million, which included $15.26 million kilogrammes of tobacco and 0.72 million kg of cigarette. Of the total amount, raw tobacco had a share of $31.84 million.

Pakistan has a market share of around $25 million in the $80 billion trade of world tobacco.

According to sources, Pakistan has been exporting tobacco (unfinished) worth $25 million to the Middle East and some European countries, which is almost 30pc of the total tobacco being produced in the country. Rest of the commodity is consumed in making cigarettes for the domestic market.

As per statistics of financial year FY19, at least 108,000 tonnes of tobacco worth $24.4 million was exported to at least 26 countries.

Pakistan’s major tobacco export destinations included South Korea, Malaysia, Indonesia, Netherlands, UAE, Paraguay, Saudi Arabia, Germany, Kazakhstan, Myanmar, UK, Kuwait, Poland, Australia, USA, Singapore, Canada, Ukraine, Philippines, Bangladesh, Belgium, Afghanistan, Italy, Russia, Yemen and Bulgaria.

3 COMMENTS

  1. Headline is factually incorrect. Philip Morris Pakistan (LTD) had been exporting Finished Goods (i.e Cigarettes) from Pakistan to Gulf States in as early as 2017.

    • Not correct.
      Philip Morris is exporting only raw (unmanufactured) tobacco and it is for first time that more thanUS$ 6 million worth finished goods were exported by Pakistan.

      • Philip Morris used to export Morven Gold for Gulf Countries from its Kotri Factory back in 2016-17. Please go check the records. Even if they had exported cigarettes worth 100 USD, it still doesn’t make PTC the first company to have exported FG out of Pakistan

        Its true that as of now it is exporting only Unmanufactured Tobacco.

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