Food exports: Govt aims to seize Russian market as EU supplies come to a halt

Food security ministry asked to prepare a comprehensive plan

ISLAMABAD: Pakistan is planning to capture part of the Russian food market following a ban imposed by Moscow on food imports from the European Union in the face of a standoff with the West over the Ukrainian crisis.

The government is looking to cash in on the opportunity despite a more than two-decade-old dispute between Pakistani traders and the Russian government over blocking payments of millions of dollars.

The traders claim that Russia has to pay $76 million to them, but the row has hampered the flow of much-needed Russian investment in Pakistan’s energy sector.

A senior official of the Ministry of Food Security and Research told The Express Tribune that his ministry had been asked by the Ministry of Commerce to prepare a comprehensive plan for the export of food products to Russia.

The government also undertook a study to assess whether the EU and US sanctions on Russia over the Ukrainian dispute could be a stumbling block in the way of food exports. It found that the curbs were not similar to those that were slapped on Iran.

“In the case of Russia, the sanctions are between the countries and are not general that could hurt trade with all nations like the way Iran is facing,” the official said. “The restrictions have nothing to do with food exports to Moscow.”

According to officials, trade between Pakistan and Russia encounters no hurdles as the latter has not placed any tariff barriers in the wake of payment claims made by the exporters.

Pakistan could export livestock (meat), apple, mango, citrus and seafood to meet the demand of Russian market, they said.

However, the longstanding payment dispute has stood in the way of investment flow from Russia. “A particular Pakistani business group is still creating hurdles and it does not look serious about resolving the issue,” the official remarked.

The exporters were seeking all payments for the goods that were ordered but were not shipped. The prime minister constituted a committee to address the issue and the body has held a few meetings, but a solution is yet to be found.

According to the officials, Russia has offered finances for energy projects including the Central Asia South Asia (Casa) 1000-megawatt power supply project and power plants in Pakistan. It has also shown interest in providing support for the expansion of struggling industrial giant, the Pakistan Steel Mills.

Published in The Express Tribune, October 18^th, 2014.

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