Pakistan’s rice exports have suffered an alarming decline, plummeting by US$1.5 billion from a peak of nearly US$4 billion to US$2.6 billion, prompting industry leaders to call for urgent government intervention to salvage the nation”s second-largest export sector.
Zubair Motiwala, Chairman of the Businessmen Group (BMG), today described the downturn as a “staggering reduction that Pakistan simply cannot afford” during a meeting between delegations of the Rice Exporters Association of Pakistan (REAP) and the Karachi Chamber of Commerce and Industry (KCCI).
Group Chairman of REAP, Abdul Rahim Janoo, echoed these concerns, stating, ‘Things are not good for rice as exports are going down the hill, and this year presents serious challenges for rice exporters, many of whom are operating at a loss, barely able to cover overheads.’
Janoo warned that the current trends are worrying, as the sector confronts multiple challenges including burdensome taxes and policy uncertainty, which are eroding investor confidence.
He recalled that under REAP’s promotional efforts, including global outreach and marketing events like the Biryani Festival, rice shipments had surged from approximately US$300 million to nearly US$4 billion, but were unfortunately now descending.
Motiwala highlighted a concerning disparity in the national economy, remarking that while the government points to improved foreign exchange reserves, this is largely due to US$38.5 billion in remittances from overseas Pakistanis. ‘It is deeply concerning and embarrassing for the entire business community that while more than one million overseas Pakistanis can send US$38 billion, our business community collectively struggles to achieve even US$32 billion in exports,’ he remarked.
He stressed that Pakistan”s true export potential is not US$32 billion but at least US$150 billion. He urged a shift from exporting raw commodities to value addition, citing Thailand”s success in producing and exporting a wide range of rice-based products like cereals. He encouraged REAP to spearhead research and development to educate stakeholders on enhancing export value.
The viability of industries is further undermined by rising input costs, particularly exorbitantly high gas tariffs, which consume a major portion of revenue, Motiwala added. He noted that many industries are not even in a position to undertake essential Balancing, Modernization and Replacement (BMR) activities.
To counter the downward trend, Janoo urged for regular consultations between KCCI and REAP to resolve sector-wide challenges. He proposed leveraging the “Biryani Festival” concept by inviting diplomats to taste multiple varieties of Pakistani biryani, believing it to be an effective strategy to market the commodity abroad.
Earlier, KCCI President Muhammad Rehan Hanif acknowledged that after several years of growth, rice exports were now showing a decline and assured the REAP delegation of the Chamber’s full support and cooperation in addressing their issues.