Pakistan has lost a $20.5 million cigarette export order to Sudan following delays in regulatory approvals, according to a report.
Though Prime Minister Shehbaz Sharif approved a necessary amendment to the Statutory Regulatory Order (SRO), the Ministry of Health’s reluctance to act led to the order’s cancellation.
The delay was compounded by lobbying from international NGOs, which raised concerns about Pakistan’s cigarette exports, slowing the process further.
This delay allowed Bangladesh to seize the opportunity, supplying the required cigarette packets to Sudan within a month. Bangladesh’s swift action highlights Pakistan’s vulnerability in the export market, where bureaucratic inefficiencies are harming potential revenue.
In Pakistan’s domestic market, illegal cigarette sales have surged, contributing to a significant decline in legal sales. Legal sales dropped by approximately 800 million sticks in the first quarter of the fiscal year, from 7.1 billion to 6.3 billion sticks.
One major brand saw a steep reduction, with annual volumes falling from 660 million to 300 million sticks.
The report projects that Pakistan’s cigarette market could face a revenue shortfall of Rs4 billion by the fiscal year’s end due to these challenges. They suggest that empowering provincial authorities to combat smuggling could help curb the illegal trade, recovering some lost revenue.
Despite government initiatives, significant obstacles remain in supporting Pakistan’s legitimate cigarette industry and expanding export opportunities in a competitive global market.
