Confusion reigned on Thursday as the government appeared to announce that it had banned the export of meat and live animals for three months through a commerce ministry handout, though it later clarified its stance saying that the ban was simply a proposal that would be taken up for discussion.
The commerce ministry released the handout about the ban on Thursday afternoon, citing rising domestic prices as the primary driver of the decision.
“A ban has been imposed on export of meat and live animals for a period of three months in order to bridge the gap between demand and supply,” said the ministry of commerce in the official handout.
Yet sources inside the meat export business in Karachi say that they continued to see shipments cleared by customs officials even after the handout was made public. Customs officials, they said, did not appear to have been told of any ban going into effect.
Pakistan currently exports meat worth $100 million annually, which is expected to reach $500 million in the next five years.
The initial handout did not mention any date of the ban going into effect and only states that it is to last for three months. It also made it clear that the initiative was being taken by Commerce Minister Amin Fahim personally, which had already raised the concern that the announcement may be meant for political purposes rather than a serious policy move.
In order to implement the ban, the government would have to, at a minimum, issue a statutory regulatory order (SRO), which now requires approval of the cabinet. There was no indication that such an approval has been given and the later handout clarified that such approval would be sought later.
The government had claimed in the initial handout that, in addition to the usual amount of smuggling of live animals, the 2010 summer floods caused the death of 1.5 million animals, which had put constraints on the total supply of animals in Pakistan.
However, industry experts say that the total number of animals wiped out by the floods represents less 1% of the total livestock population of Pakistan, which exceeds 150 million.
“If the government has been dumb enough to implement this ban even temporarily, they should know that they would have locked Pakistan out of the global meat market for ten years,” said Ali Khan, a consultant at ASI Partners who has advised companies in the meat export business.
Khan says that regulators from several Middle Eastern countries – including Iran, Saudi Arabia and the United Arab Emirates – are inspecting meat processing facilities in Pakistan for export. “If we don’t get into this business now, India will grab whatever market we could have taken,” he said.
Kamran Khalili, the CEO of the Al Shaheer Corporation, a meat export firm, said: “We don’t think the government would make such a blunder. Several companies have invested millions of dollars into this business and we bring in millions of dollars in foreign exchange.”
Pakistan has the world’s third largest herd of goats, the eighth largest herd of cattle and the second largest herd of buffalo in the world. The country has geographic and cultural proximity to the Middle East, a region with relatively high per capita incomes and very low agricultural production capacity.
Even the ministry’s first `handout acknowledged the ministry’s ‘historical’ stance in support of the ‘value-added’ food export business, a list that the commerce ministry says includes “meat, meat products and finished leather goods.”
K&N, the maker of frozen chicken products, has recently obtained a licence to begin exporting its products to the United Arab Emirates, the first such Pakistani company to do so.
After the 18th Amendment to the constitution, livestock is a matter legislated over by the provinces, and the Punjab government in particular – run by the ruling PPP’s rival party, the PML-N – has been very active in promoting the meat export business, since close to 60% of the country’s livestock is located in Punjab.
Published in The Express Tribune, July 29th, 2011.
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Pakistan exports almost 100 million dollars worth of meat - worth approx pak rupees almost 9 billion rupees.
Should Pakistani public of 180 million made a scapegoat to pay pak rupees 550 per kg for mutton just so we can make 8 billion rupees in export ?
secondly, i find this figure of livestock dubious
Instead of banning it, increase the export duty! Keep earning while reducing exports.