Pakistan's award-winning Loralai Olives eyes exports to US, Japan, Gulf markets
KARACHI: A Pakistani olive oil firm is eyeing the US, Gulf and Japanese markets for exports as world leaders Italy and Spain see a decline in production, creating space for new entrants, the chief executive officer of the company said in an interview this week.
Khaity Technologies (Pvt.) Ltd., is a top AI-powered agriculture app that owns Loralai Olives (LO), named after an olive-producing district in Pakistan's southwestern Balochistan province. In recent weeks, LO has received global recognition by securing silver for olive oil quality at the 2025 New York International Olive Oil Competition.
Olive production is beneficial for Pakistan due to its potential to reduce the country's reliance on imported edible oils, create jobs, and promote sustainable agriculture. Additionally, it can boost the economy by establishing a new export market and fostering entrepreneurship. Olive trees are hardy and can thrive in various conditions, including water-stressed areas, making them an environmentally sustainable crop.
'We will be doing some exports when Pakistan starts harvesting olive crop this year in October- November,' Shaukat Rasool, the CEO of Khaity Technologies, told Arab News in a telephone interview, saying Pakistan had the potential to export as much as $2 billion worth of olive oil if it could grow 10 million fruiting trees across Pakistan in the next five years.
'The GCC [Gulf Cooperation Council] can be a big market for us as they too import a big chunk of olive oil,' said Rasool, adding that the US and Japan were key export markets to tap.
The olive production decline in Italy and Spain is largely due to the impacts of climate change, including prolonged droughts and increased heat, which negatively affect olive tree growth and yields.
With depleting production in the two leading manufacturing countries and space for new entrants in the market, Pakistan needed to look to tap the $15 billion olive oil exports market, Rasool said.
'Their [Italy and Spain] production is decreasing, leading to a price hike that is forcing their global customers to look for a substitute to fill this gap,' said Rasool, who has set an annual target for his company to export more than 200 tons of Pakistani olive oil in the next five years.
'Pakistan can fill that gap and produce as much olive oil as Italy and Spain are producing.'
Pakistan's olive oil production is already experiencing a boom, with the country aiming to produce 4,600 tons by 2030. While currently producing around 861 tons of table olives annually, Pakistan has the potential to become a major olive oil producer, with 10 million acres of land suitable for cultivation, almost twice the area of Spain. Production had increased from 90 kilograms in 2019 to over two tons in 2022 and 2023 in the Hazara region alone.
SUPPORTIVE ECOSYSTEM
Rasool, whose company employs 60 people, launched the LO brand last year after harvesting his first olive crop at orchards spread over 50 hectares in the Chakri village of Rawalpindi as well as what his company collected from farmers in the Loralai district of Balochistan.
'This year we have extracted around 10 tons of olive oil while next year our target is to scale this up to 25 to 30 tons,' he said.
Increased local production will save most-needed forex reserves for Pakistan which last year had to spend $2.9 billion on the import of palm and soya bean oil for domestic consumption, according to official data. This year through April, the country's imports surged as much as 140 percent to $3.2 billion.
Pakistan is also seeking to promote drought-resistant crops like olives that can live for a thousand years without consuming much water, said Rasool.
Pakistan has collaborated in the past with Italy, the world's biggest olive producer, to develop its olive sector and has so far grown as much as six million trees in the Balochistan, Punjab and Khyber Pakhtunkhwa provinces.
'The government has identified more than 95 districts across Pakistan for cultivating olive,' said Rasool.
While Khaity Technologies is currently selling its olive oil nationwide through Facebook, WhatsApp and other social media platforms, the firm is hoping to secure as much as $1 million in investment from local and international partners to set up an extraction plant at the site of its olive farm in Rawalpindi.
'Extraction mills must be set up inside the olive farms because the quality of oil is time-bound in terms of extraction,' Rasool explained.
Pakistan currently has three extraction plants, two set up by the government and one by a private party, in Loralai, which have a 600 kilograms per hour crushing capacity. LO uses a government extraction plant to extract olive oil within six to eight hours of harvesting.
To produce the best quality olive oil, the fruit must be harvested and milled for the extraction of oil within 10 hours, Rasool explained.
In Loralai, the government has established a mill with a capacity to crush 600 kilograms of olive fruit in an hour, helping farmers extract oil within six to eight hours of harvesting.
'Next time, maybe we can win gold if we could be able to bring down our milling time to three to four hours,' Rasool said.
'There should be an ecosystem that addresses the entire olive oil supply chain ranging from harvesting to extraction and storage.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Arab News
13 hours ago
- Arab News
Pakistan unveils five-year tariff reform plan, warns of additional taxes if compliance measures blocked
KARACHI: Pakistan plans to cut its overall tariff regime by more than 4% over the next five years, part of sweeping reforms aimed at boosting exports and shifting the country towards an export-led growth model, Finance Minister Muhammad Aurangzeb said on Wednesday. At a post-budget press conference in Islamabad, Aurangzeb outlined details of the proposed tariff rationalization, saying the government had already removed additional customs duties on 4,000 tariff lines and reduced them on another 2,700, out of a total 7,000. The reforms align with Pakistan's commitments under a $7 billion IMF program approved last year and signal a shift toward an export‑oriented growth model built on a leaner tariff structure, protection of social welfare, and improved tax collection. 'First, the goal is to change the overall protected regime. When you lower protection and dismantle walls around it, you improve the economy's resource allocation, better capital allocation, better human resource allocation, so that's the overall macroeconomic framework," Aurangzeb said, adding that the changes would reduce input costs for exporters and improve competitiveness. The reforms are part of the National Tariff Policy 2025–30 under which the government plans to abolish additional customs duties, regulatory duties, and the fifth schedule of the Customs Act, 1969. The policy envisions a streamlined customs structure with just four duty slabs ranging from 0 to 15%, which would become the maximum rate. 'According to the World Bank, after the successful implementation of these reforms, Pakistan's average tariff will decline to the lowest level in the region,' Aurangzeb had said during his full-year budget speech on Tuesday, when he presented the Rs17.6 trillion ($62 billion) federal budget for FY2025–26. Describing the initiative as Pakistan's 'East Asia moment' during the post-budget speech, the minister said the plan was designed to help the country avoid recurring balance-of-payments crises. 'So that when we go toward growth we don't get into the dollar situation, we don't get into a balance of payment problem,' he said. 'So that we can continue to grow at a certain pace which is export-led.' Aurangzeb emphasized that the tariff cuts would be phased in gradually, starting this year. 'This I am talking about year one. We will take it towards a more than 4 percent reduction in the overall tariff regime in Pakistan,' he said. The government is aiming to lift exports, which grew more than 6% year-on-year to $26.9 billion during July-April, against imports of $48.3 billion, up 8% in the same period. ENFORCEMENT, ADDITIONAL TAXES Aurangzeb also warned that the government could be forced to impose Rs400–500 billion ($1.4-1.75 billion) in additional taxes if the Pakistani parliament failed to pass enabling legislation needed to implement enforcement provisions tied to Rs312 billion ($1.1 billion) in proposed new tax measures for the coming fiscal year. 'The parliament should help us in enabling amendments so we don't opt for additional measures to stop the leakages in the system,' he said. The minister noted that enforcement actions in the current fiscal year had already yielded Rs400 billion ($1.4 billion) in additional revenue. Without legislative support, the government may be compelled to introduce further taxation to close gaps. Without naming them directly, Aurangzeb said international financial institutions had signed off on Rs389 billion ($1.36 billion) in additional taxes for FY26 as part of budget negotiations. 'We now have the credibility and trust internally and externally that we can do the enforcement,' he said. BUDGET NUMBERS 'LOCKED' WITH IMF Flanking the finance minister, Finance Secretary Imdadullah Bosal said the government had 'locked' all key budget numbers with the IMF. The $7 billion loan program the lender approved for Pakistan in 2024 comes with a strict reforms agenda on fiscal consolidation, debt rationalization, revenue mobilization, among other issues. The IMF, in a recent statement, confirmed Pakistan had committed to continued fiscal consolidation while safeguarding social and priority spending in the new budget. Bosal said the government had managed to reduce current expenditures to under 2% growth in FY25 from 26% in FY24. 'This is our response back to those people who are paying taxes in this country,' Aurangzeb said, adding that the budget had attempted to extend relief to pensioners, salaried individuals, and businesses, despite fiscal constraints. 'The federal government, whatever it is giving, is from the loans that we are taking because we start [the new year] with a deficit.'
Arab News
13 hours ago
- Arab News
Pakistan's plan to sharply increase growth faces headwinds — analysts
ISLAMABAD: Pakistan is aiming to sharply increase economic growth under its annual federal budget unveiled on Tuesday, but analysts are skeptical about the country's ability to meet its ambitious goals. The budget targets higher revenues and a steep fiscal deficit cut under International Monetary Fund (IMF) backed reforms. Yet, defense spending was hiked 20 percent, excluding military pensions, after last month's conflict with India. Finance Minister Muhammad Aurangzeb said in a post-budget press conference on Wednesday that customs duties have been cut or removed on thousands of raw materials and intermediate goods. 'Industry here has to be competitive, competitive enough to export,' he said. But growth drivers remain unclear. The government is targeting 4.2 percent GDP growth in fiscal 2026, up from 2.7 percent this year, which was revised down from an initial 3.6 percent as agriculture and large-scale manufacturing underperformed. 'Pakistan's GDP growth projection of 4.2 percent appears ambitious given recent performance, and overly optimistic assumptions may place tax targets out of reach,' said Callee Davis, senior economist at Oxford Economics. Pakistan's past growth spurts were consumption-led, triggering balance-of-payments crises and IMF bailouts. The government says it now wants higher-quality, investment-driven growth. Aurangzeb said structural reforms are underway, pointing to East Asia-style pro-market transitions. 'This is an East Asia moment for Pakistan,' he said. 'BUDGET KEEPS IMF HAPPY' The 17.57 trillion rupee ($62.24 billion) budget comes as Pakistan remains under a $7 billion IMF program. Revenues are projected to rise over 14 percent, driven by new taxes and broadening the tax base. The fiscal deficit is targeted at 3.9 percent of GDP, down from this year's 5.9 percent. Key reforms include taxing agriculture, real estate, and retail, and reviving stalled privatizations. But revenue shortfalls this year have raised doubts, with both agriculture income tax and retail collections missing targets. Only 1.3 percent of the population paid income tax in 2024, government data shows. 'Pakistan's budget keeps the IMF and investors happy, even if it comes at a near-term cost to growth,' said Hasnain Malik, head of equity strategy at Tellimer. 'The political setup, with the military firmly in charge, also lowers the risk of protests.' While overall spending will fall 7 percent, defense will rise after the worst fighting between the nuclear-armed neighbors in decades. Including pensions, defense spending will total $12 billion, 19 percent of the federal budget or 2.5 percent of GDP, matching India's share, per World Bank data. The hike was enabled by a sharp drop in interest payments, as the central bank cut policy rates from 22 percent to 11 percent over the past year, easing domestic debt servicing costs. Aurangzeb said cuts in subsidies also helped create fiscal space. ($1 = 282.3000 Pakistani rupees)
Arab News
14 hours ago
- Arab News
Saudi Arabia leads surge as Pakistan's May remittances hit $3.7 billion
KARACHI: Pakistan received $3.7 billion in workers' remittances in May 2025, a strong 16 percent increase month-on-month and 13.7 percent year-on-year, the State Bank of Pakistan (SBP) said on Wednesday, with Saudi Arabia remaining the largest contributor, sending $913.9 million. The inflows brought total remittances for July-May FY2024-25 to $34.9 billion, marking a 28.8 percent increase from $27.1 billion in the same period last year. The rise follows a record breaking $4.1 billion in March, the highest-ever single-month inflow, and a robust $3.2 billion in April. The strong performance has helped offset Pakistan's trade deficit and support its fragile foreign exchange reserves amid continued macroeconomic pressure. 'This is the highest level of remittances recorded in recent months,' the SBP said in a statement, noting that the increase reflected stronger flows from key corridors and a growing shift toward formal remittances channels. Analysts attribute the surge to a combination of factors, including improved exchange rate management, government crackdowns on hawala and hundi informal systems for transferring money internationally, and seasonal flows during Ramadan and Eid. Saudi Arabia remained the largest contributor in May, sending $913.9 million, followed by the United Arab Emirates ($754.2 million), the United Kingdom ($588.1 million), and the United States ($314.7 million). Remittances remain a critical source of foreign exchange for Pakistan, which is currently under a $7 billion IMF program and facing over $24 billion in external debt repayments over the next fiscal year. The central bank has raised its full-year remittance forecast to $38 billion, reflecting optimism that flows will continue to support economic stabilization. The surging remittances, especially from Saudi Arabia, help cushion Pakistan's chronic current‑account deficit and bolster its foreign exchange reserves, offering relief ahead of major debt repayments. With global commodity prices still volatile and external financing constrained, continued inflows from overseas workers, particularly from the Gulf, are seen as crucial to maintaining macroeconomic stability and supporting Pakistan's growth outlook under IMF conditions.
