Call for increasing local production of tea to cut import bill

Domestic consumption of beverage set to increase by another 10% in next five years

KARACHI:

Senator Talha Mahmood, chairman of the Senate Standing Committee on Finance and Revenue, has identified the absence of local production of tea as a major drawback to keeping the country’s import bill low.

Addressing the golden jubilee celebrations of the Pakistan Tea Association on Saturday, the senator said keeping tea on the list of luxury items was “unfair” and added that amid the surge in prices of food items, tea could still be a cheap food item had it been produced locally.

He lamented that a huge chunk of foreign exchange was spent on importing the tea. “If local tea production is promoted, the country's import bill could be significantly reduced,” Mahmood said, suggesting that the persistent financial woes could be averted if the government adopted a policy that focused on resolving the problems of traders and expanding their businesses.

Censuring the government for failing to deliver on its promises of providing employment opportunities, the senator laid stress on the need to strengthen the private sector which he believed had the potential to generate jobs. “The government should take practical measures instead of making verbal claims.”

He said strict measures imposed on the trade and industry were inappropriate and recommended a gradual and phase-wise implementation of such measures in order to smooth out problems of the business community.

Speaking on the occasion, Dr Abdul Waheed, Director Shankiari Tea Project said that the tea being produced in Shankiari was of the same quality as the one imported from abroad, stressing that the private sector should play a role to promote local tea production which he assessed would reduce the import bill by 45% in the next five years.

Pakistan Tea Association Chairman Aman Paracha deplored putting the beverage on the luxury list and the 53 per cent tax levied on the import of tea. He said that tea should be given the status of raw material as it is first converted into a finished product through blending.

“PTA members pay Rs40 billion annually in terms of duties and taxes,” he said, adding that 4 million people are directly and indirectly employed in the tea industry.

Addressing the function, FPCCI President Nasir Hayat Magun and Karachi Chamber President Shariq Vohra said that after palm oil, tea was the second-largest import good in the country.

They held the opinion that in view of the growing population and increasing consumption of tea in Pakistan, local production of tea was fast becoming a matter of urgency as domestic consumption of tea will increase by another 10% in the next five years.