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Business Recorder
2 days ago
- Business
- Business Recorder
MoC prepares mechanism for barter trade with Iran
ISLAMABAD: Ministry of Commerce (MoC) has prepared a viable mechanism for barter trade with Iran in consultations with the stakeholders, as State Bank of Pakistan (SBP) is unwilling to support formal trade with Iran owing to the US restrictions. This update was shared by Secretary Commerce Jawad Paul with Senate Standing Committee on Commerce on Wednesday, presided over by Senator Anusha Rahman Ahmad Khan. The Committee assured full support to Commerce Ministry in this regard so that Pakistan's exports to Iran can begin as officially exports to Iran are zero. With amendments to the SRO, more items will be included to the existing list which will be almost at par with the Export Policy Order. However, the issue of 'certification authority' is yet to be sorted out. According to Commerce Ministry, in pursuance to the decision of the ECC, Ministry of Commerce issued S.R.O 642 (1)/ 2023 on June 1, 2023, whereby, B2B Barter Trade Mechanism was notified for enhancing bilateral trade with Afghanistan, Iran and Russia along with list of exportable/ importable products. Since its inception, there have been issues in the operationalisation of the B2B barter trade as highlighted by the business community and public stakeholders. Pakistan, Iran: Work on mechanism to institutionalise barter trade underway Following recommendation of the Senate Standing Committee on Commerce in its meeting held on January 15, 2025, the Ministry of Commerce had notified the committee comprising of public and private stakeholders notified with the objective to identify gaps and issues in the B2B Barter Trade Mechanism (S.R.O.642). The Committee convened multiple meetings with the stakeholders to identify the gaps and issues in the Barter Trade Mechanisms. During the consultations, following issues were highlighted by the private sector: (i) verification of sanctioned/ non-sanctioned products/ entities by respective Pakistan Missions abroad; (ii) limited list of exportable/ importable products; (iii) principle of 'import followed by export'; and (iv) absence of multiparty contract(s); i.e., consortium. Based on the recommendations of the Committee, a report was submitted to the Senate Secretariat. Secretary Commerce further stated that on the directions of PMO, the Ministry of Commerce held wide-ranging consultations with the public-private stakeholders for early operationalization of the B2B Barter Trade Mechanism (S.R.O 642 (1)/ 2023). After detailed deliberations held with the SBP, MoFA, FBR and PSW during the meetings held on May 19, May 27 and May 29, 2025 , following amendments in the subject SRO have been prepared: (i) the list of importable products as specified in Appendix-A of the S.R.O 642(1) /2023 may be omitted and aligned with Import Policy Order (IPO)/ Export Policy Order (2022); (ii) role of the Pakistan Mission/ MoFA for verification of sanctioned/ non-sanctioned products/ entities be done away with, instead, the Pakistani private entity shall be required to give an 'Undertaking' that the foreign company or individual for BT is not a 'sanctioned entity' by the UN and others; (iii) the principle of 'import followed by export' may be replaced with 'Imports/ Exports'; (iv) Pakistani traders shall be responsible to net off value of goods on quarterly basis; i.e., within 90 days of the transaction (wholly or partially) as allowed by the regulatory Collectorate of Customs in the authorisation; and (v) allowing private entities (02 or more) to form 'Consortium' from Pakistan to enter into a single contract and a single trading partner. In light of deliberations, a draft Notification is being prepared and the same will be circulated to all concerned stakeholders for views/ comments. Upon receiving concurrence of the stakeholders on the proposed amendments, the Ministry of Commerce shall issue a notification of the same as empowered under Para 8(4) of the S.R.O 642 (1) /2023 without the requirement to place the matter before the ECC/ Cabinet. The meeting also approved amendments to anti-dumping duties (amendment Bill 2025) to refund amount to Chinese companies which built Gwadar Airport and a hospital at Gwadar through grant in aid, after some 'ifs and butts' raised by PTI Senators and clarification from Commerce Ministry and National Tariff Commission. The Committee was briefed that the first amendment in the said act was made in 2022 in the backdrop of two Chinese projects pertains to Gwadar Airport and Hospital. However, the proposed amendment has been brought forward for the second time. These amendments are provided for the said two Chinese projects, and there is no other related project in this connection. The first amendment made in 2022 did not fully address the need and does not have retrospective effect. Hence, a second amendment is still required for the retrospective effect in order to bring the FY 2020-2021 & 2021-22 into the ambit of this Act. It was informed that the said bill has been passed by the National Assembly. The Chairperson Committee expressed concerns, asking whether it could happen in the future that any project might be added and the amount could increase. The Ministry stated that no such project related to levying of duties on foreign grant-in-aid for anti-dumping duties was carried out during 2020-2022 except the above-mentioned two Chinese projects. After extensive deliberation the bill was unanimously passed. Ministry of National Food Security and Research apprised the committee of a summary to allow export of maize and herbal medicines to China which is ready for final nod of Cabinet, after being grilled by Chairperson Standing Committee for not being active in opening doors for export. The Committee discussed status of protocols pending for Cabinet approval with Ministry of National Food security and Research regarding corn/ maize/ wild/ dried fruits/ nuts/ herbal medicine equated products; etc. Spokesperson, Ministry of National Food Security told the protocols related to herbal products and maize are in finalization stage and once approved by the Chinese government, the gateway of imports and exports of such products with China will be opened. Chairperson Committee Anusha Rehman told the Committee that she had visited China and found out that no export protocol has been done for dry fruits. 'Protocols should be established for all herbal and dry fruit products in Pakistan that can benefit us economically. This is in our interest.' The Chairperson recommended the concerned Trade & Investment Officer to submit a market intelligence report on those potential products which are produced in Pakistan and China has a huge potential of importing those products from Pakistan, but are delayed due to certain protocols. The doors to China's demand for herbal products and dry fruits remain closed only due to the absence of protocols. The Committee also directed Commerce Ministry to liaison with Ministry of Foreign Affairs, on the issue of ASEAN Free Trade Agreement (FTA) as Commerce was not in the loop on this issue. The Committee refused to hear the representatives of Karachi Chamber of Commerce and Industry (KCCI) against the law which allows opening of Chambers in every district despite the fact President KCCI Jawed Bilwani argued against the current status of chambers already opened in Karachi including a women chamber. However, Chairperson Standing Committee asked Director General Trade Organisations (DGTO) Bilal Khan Pasha to proceed as per the law and give proper opportunity to KCCI in this regard. Secretary Commerce suggested the KCCI representative to wait for reply of its letter sent to Commerce Ministry. Copyright Business Recorder, 2025
Business Recorder
12-05-2025
- Business
- Business Recorder
Mango exports begin from 25th
ISLAMABAD: The government has decided to commence mango exports from May 25. The Ministry of Commerce has issued a circular regarding mango exports for the 2025 season, confirming that other conditions for mango exports will remain in effect under the Export Policy Order. The export date was determined through consultations with the stakeholders committee. It should be noted that Pakistan exports approximately 130,000 metric tons of mangoes annually. Last year, Pakistan earned more than $90 million in foreign exchange from mango exports. Pakistani mangoes are exported to numerous countries, including the United Arab Emirates, Afghanistan, Iran, the United Kingdom, and the United States.
Business Recorder
25-04-2025
- Business
- Business Recorder
Gwadar Port: SRO issued to allow potassium sulphate export
ISLAMABAD: The Ministry of Commerce (MoC) has issued Statutory Regulatory Order (SRO) aimed at allowing export of potassium sulphate from Gwadar Port. The federal government has allowed two companies to export potassium sulphate from Gwadar Port along with strict monitoring of quantitative restrictions to be put in place in customs WeBOC system in order to check export data on real-time basis. According to the SRO 705(1) 2025, in exercise of the powers conferred by sub-section (I) of section 3 of the Imports and Exports (Control) Act, 1950 (XXXIX of 1950), the federal government has directed that further amendment be made in the Export Policy Order, 2022. In the SRO, in Schedule-I, in column (1), against Sr No 12, in column (4), after the word and full stop 'agencies' the following shall be inserted: 'export of potassium sulphate (K2SO4) (HS Code: 3104.3000) from Gwadar Port by companies manufacturing in Gwadar Free Zone.' Ahsan for development of Gwadar as mining port Sharing the details, sources said, two major industries namely Agven Private Limited (fertilizer) and Hangeng Trade Company Private Limited (meat and agriculture processing) are fully established and operational in the Gwadar North Free Zone. Agven is a fertilizer production company registered in North Free Zone. The company started production of potassium Sulphate from its plant with a capacity of producing 20,000 tons per annum. Potassium sulphate fertilizer overall consumption in Pakistan is 50,000 tons per annum (average as per National Fertilizer Development Center data), whereas the overall production installed capacity in Pakistan is 65,000 tons per annum, including the 20,000 tons per annum in Gwadar Free Zone. The company had shown an interest in exporting its production of potassium sulphate from Gwadar Port in its application of October 28, 2024. The company stated that it does not use any subsidized raw materials or resources from Pakistan including use of gas as raw material. The main raw material viz potassium chloride is directly imported from abroad. It is not sourced from the tariff area of Pakistan and does not impact the supply of fertilizer for domestic use. According to MoMA, export of urea/fertilizers is banned and subject to the provisions of serial No.11 and 12 of Schedule-I of Export Policy Order, 2022. Multiple meetings have been held with Ministry of Industries and Productions, Commerce, and FBR to resolve the issue but the only way forward is to relax the Export Policy Order, 2022 for the export of potassium sulphate (K2SO4) fertilizer from Gwadar Port. Gwadar Port Authority supported the request of the company for exemption of the Export Policy Order, 2022 to the extent of potassium sulphate (K2SO4) fertilizer by M/S AgvenPvt Ltd, as the export of the commodity would help in development and operationalisation of Gwadar Port. The export will also allow the expansion of capacity inside Gwadar Free Zone and generate export revenue. The sources said SRO has been amended on the basis of following stipulations: (i) a maximum of 10,000 tons per annum or 50% of the actual annual production of potassium sulphate, whichever is less; (ii) this permission will be for one year till December 31, 2025 and will be implemented in two parts by allowing a maximum 5,000 tons by June 30th 2025, and remaining 5,000 tons by December 31, 2025 (plus or minus any balance quantity to June 30th); (iii) Ministry of Industries and Production/Fertilizer Review Committee (FRC) will ensure to collect data input related to production and export abroad on monthly basis from the manufacturers inside the Gwadar Free zone and will review the export abroad on annual basis; (iv) Ministry of Industries & Production will notify the decision for export abroad of potassium sulphate fertilizer (HS Code 3104.3000) and convey the same to the FBR and the relevant ministries/divisions; and (v) the FBR will update its system with respect to export abroad of potassium sulphate (K2SO4) as per above detail from Gwadar Port. Copyright Business Recorder, 2025
Express Tribune
14-02-2025
- Business
- Express Tribune
Gwadar Port operations face hurdles
Listen to article ISLAMABAD: The government is facing a host of challenges in the way of operationalising Gwadar Port despite offering a lucrative deal to the Chinese port operator. In a report submitted to the prime minister, several challenges have been identified like the reluctance of international insurance companies due to security challenges, higher port costs and the lack of road and rail infrastructure. Despite its geostrategic advantage, the port had not been able to secure a significant share in the global merchant shipping traffic, it said. Operational costs are high, making the port less competitive than regional ports like Jebel Ali and the local economy does not generate sufficient cargo volumes. There have been high insurance costs that discourage international shipping lines. Absence of stable cargo flows and agreements with major shipping lines hampers economic activity. Dedicated feeder ships (up to 1,500 twenty feet equivalent units – TEUs) are needed to facilitate transshipment between Gwadar and Persian Gulf ports. Also, currency exchange losses restrict investor interest in export businesses. The report revealed that certain finished products were restricted from export under the 2022 Export Policy Order. China's Xinjiang province relies more on road and rail than ports, depriving Gwadar of potential benefits. According to the report, industrial relocation to Gwadar Free Zone remains limited due to multiple factors and high production costs while harsh environmental conditions discourage foreign investment. Restrictions on movement of foreign workers, including Chinese personnel, impact operations. There are inefficient border terminals at Khunjerab, Torkham and Chaman, creating bottlenecks to transit trade. Security concerns, weak infrastructure connectivity and the lack of infrastructure limit economic growth. The potential for large-scale aquaculture development remains untapped due to the dearth of advanced facilities. Outlining the opportunities for Gwadar Port, the report revealed a proposed salt project at Khor Kalmat and potential joint ventures for aquaculture with international partners. There is also the possibility of setting up an automobile park and a bulk storage facility at terminals as well as engagements with Chinese fishing trawler companies to establish a fish processing industry in Gwadar Free Zone. In addition to these, the utilisation of Gwadar Port as a logistics hub for Central Asian Republics can leverage the North-South transport corridor. The government has approved several short, medium and long-term measures, which include the organisation of an international conference in Islamabad to promote Gwadar and the development of a comprehensive marketing strategy. It called for accelerating diplomatic outreach to attract economic and commercial interests from Central Asian states and engaging with chambers of commerce and Afghan transit traders to enhance regional trade. The government approved the initiation of feasibility studies for roll-on/roll-off vehicle transshipment and the completion of critical infrastructure projects such as M-8, ML-4 and the Eastbay Expressway. It agreed on measures to encourage Chinese companies to utilise Gwadar for transshipment and establish ship repair facilities. It decided to promote technology adoption including artificial intelligence, Big Data and radio frequency identification (RFID) for cargo handling, and designate Gwadar as a dedicated mining port for Balochistan. The government gave the go-ahead for creating an exclusive residential area for foreign workers, implementing Gwadar Master Plan and establishing a shipyard. The minister for planning, development and special initiatives briefed the cabinet in a recent meeting on the proposed plan to operationalise Gwadar Port, including imports and exports, road connectivity and airports. The briefing covered various aspects including the significance of Gwadar Port, infrastructure development, hinterland connectivity, concessions and incentives, challenges in operationalisation and opportunities for Gwadar as a logistics hub for Central Asian Republics.
