The All Pakistan Fruits and Vegetables Exporters, Importers, and Merchants Association (PFVA) has proposed budgetary measures to reduce production costs, increase exports, and support industry growth.
The recommendations include higher taxes on finished goods and lower duties on raw materials, particularly for packaging and essential imports. The food and agriculture sector plays a key role in Pakistan’s economy, but high tariffs on raw materials and packaging are affecting growth, PFVA said.
Provisional GDP data for Q1-FY25 showed growth of 0.9%, down from 2.3% in Q1-FY24, with agriculture sector growth slowing to 1.2% from 8.1% last year, according to the State Bank of Pakistan (SBP).
Waheed Ahmed, Patron-in-Chief of PFVA, said the reforms focus on cost reduction and export growth. “Lowering production costs and ensuring fair competition will help Pakistan expand in global markets,” he said.
PFVA recommends cutting import duties on plastic and paperboard packaging, currently at 16% and 20%, to 8-10%, with exemptions for exporters. It also suggests exempting suppliers of exporters from duties to reduce input costs.
To support local agriculture, PFVA proposes raising the Regulatory Duty (RD) on imported tomato paste from 20% to 40%, encouraging manufacturers to source locally. Despite 20% customs duty and 20% RD, imported paste remains cheaper than local production, Ahmed said.
He urged protective measures to boost food processing and supply chains.
Another key proposal is lowering import duties on aseptic bags for juice packaging, currently taxed at 20% customs duty, 6% additional duty, and 10% RD, to reduce production costs.
PFVA also recommends shifting the 20% Federal Excise Duty (FED) on fruit juices from the final product stage to the import stage of aseptic packaging to prevent tax evasion. Many manufacturers import materials, produce juices locally, and bypass taxes.
Applying FED at the import stage would ensure fair taxation and higher government revenue, Ahmed said.
These reforms aim to adjust tariffs, attract investment, and strengthen local manufacturers, he added. If implemented, they could increase processed food exports and align with Pakistan’s economic policies.
PFVA urges policymakers to include these measures in the upcoming budget for long-term growth.
