ISLAMABAD: In an effort to enhance the export potential and competitiveness of Pakistan’s fruit and vegetable industry, the All Pakistan Fruit & Vegetable Exporters, Importers & Merchants Association (PFVA) has put forward a comprehensive budget proposal for the fiscal year 2023-24.
The budget proposals, shared with the concerned ministry, a copy of which is also available with this scribe, focuses on key areas of concern and suggests strategic measures to address them.
Fresh Kinnow: The budget proposal emphasizes the urgent need to develop new varieties of Kinnow, a popular citrus fruit. The existing variety in Pakistan is 60 years old, leading to various diseases and reduced shelf life. The PFVA proposes allocating PKR 100 million for extensive research and development to create new disease-resistant varieties. This investment is projected to boost Kinnow exports from the current USD 110 million to $350 million within four years, benefiting the industry worth Rs. 130 billion.
Withdrawal of 10% FED on Juice Industries: According to the association the imposition of a 10% Federal Excise Duty (FED) on packaged juices has adversely affected the industry. Sales have plummeted by 45%, leading to underutilization of production capacity and a decline in investments. The PFVA recommends the withdrawal of this FED, as it hampers sales tax revenue and negatively impacts employment in the allied industry. By procuring fruits from local farmers, the industry can prevent food wastage and uplift farmers’ livelihoods.
Exemption of Sales Tax on Mushrooms: To promote the local production of mushrooms, the PFVA proposes exempting sales tax on fresh, frozen, or otherwise preserved mushrooms. Currently, a significant portion of mushrooms is imported from China and other countries. This tax exemption would encourage local growers, discourage imports, and conserve foreign exchange reserves.
Revision of Phyto-Sanitary Certificate Costs: The proposal highlights the need to revise the high costs associated with phyto-sanitary certificates for export consignments. The recent increase of over 800% in charges for issuance of these certificates has placed an additional burden on exporters, especially those using air transportation. The PFVA suggests revising the charges to a reasonable level to ensure the smooth functioning of the export industry.
Exemption of Import Duty on Aseptic Bags: Aseptic packaging bags, used to enhance the shelf life of products, are currently imported at a significant cost. The PFVA recommends exempting import duties on these bags, as they are not locally manufactured. This exemption would reduce costs for processing units and help meet the increasing demand for local fruit and juice industries, benefiting both producers and consumers.
Exemption of Import Duty on Spare Parts for Juice Industries: The budget proposal calls for the exemption of import duties on spare parts used in the manufacturing and processing of juice industries. Currently, these parts are imported at considerable costs, including import duties, additional custom duties, sales tax, and income tax. Exempting these duties would reduce production costs and enhance the competitiveness of local juice manufacturers in both domestic and international markets.
