Over 450 imported timber containers stuck
The clearance of nearly 450 containers carrying timber, which was imported from the United States and European countries, has been stopped as the government has made it mandatory for the timber importers to get phytosanitary certificate from the exporting country.
Owing to the suspension, the timber companies in Pakistan are incurring an additional cost of $175 per container per day in terms of demurrage and detention charges. This has also put the expected tax receipts of Rs300 million at stake.
Sources told The Express Tribune that Pakistan “imports 1,500 containers of various types of timber per month from the United States, Austria, Sweden, Germany, France, other European countries and Canada”. On these imports, the government fetches annual revenue of about Rs7 billion in terms of duties and taxes.
All Pakistan Timber Traders Association Chairman Sharjeel Goplani pointed out that the move to make timber imports subject to the phytosanitary certificate was taken at the behest of the Plant Protection Department. As a result, “customs clearance of imported timber consignments has been suspended since June 16”.
He said that a letter was also issued by the Plant Protection Department to the customs authorities in which it had been clarified that all timber consignments imported into the country before June 16 should be given clearance.
However, he added, the customs officials were not implementing the directives given in the letter.
He revealed that the certificate condition had been rejected by the US companies and they also refused to accept timber orders from Pakistan.
Pakistan imports $54 million worth of timber annually from the US alone. US exporters insist their country has tougher sterilisation standards than Pakistan, therefore they do not require phytosanitary certificates for their consignments.
Goplani elaborated that under the new conditions, the consignments with phytosanitary certificates could be cleared only by the quarantine department of the exporting country.
He demanded that the federal government withdraw the orders and give directives for the immediate release of consignments so that huge demurrage and detention charges on the shipping companies was avoided.
According to a survey conducted by the Food and Agriculture Organisation of the United Nations, Pakistan needs a forest cover of 25-30% according to its population and land area. In contrast, the country has only 1.57% forest cover, which implies that the use of local timber will further threaten the environment.
Published in The Express Tribune, June 26th, 2022.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.