Pakistan Tea Association (PTA) Chairman Muhammad Altaf, while talking to Business Recorder here on Monday, said the situation was not ripe for such a move at this stage. Any decision taken in haste would push up tea prices because the present tea stocks are not enough to meet the total requirements of the country, he added.
He said Pakistan is not in a position to look for any other country overnight as 62 percent of the total import of tea depends on Kenya and, at present, any other country cannot meet its demands.
This is off-season in many countries, including Bangladesh, India, Nepal and Vietnam. The next tea season would start from April, and tea for import would be available in the first week of May as a first flush, which is not a good quality tea, he added.
Talking about the tea import market, Altaf said that Pakistan imports more than 117,257,844 kilograms worth Rs 11.472 billion from 19 different countries annually.
Of this quantity, 72,691,697-kg of tea worth Rs 7.765 billion comes from Kenya only, while 9,939,657-kg worth Rs 739.248 million from Indonesia, 9,426,889-kg worth Rs 695.911 million from Bangladesh, 2,985,271 kg from Burundi, 270,620 kg from China, 90,695 kg from Congo, 606,860 kg from Ethiopia, 3,371,781 kg from India, 15,115 kg from Malawi, 672,035 kg from Nepal, 128,360 kg from P.N. Guinea, 4,729,601 kg from Rwanda, 146,504 kg from S. Africa, 2,869,479 kg from Sri Lanka, 2,982,746 kg from Tanzania, 1,492,920 kg from Uganda, 2,637,145 kg from Vietnam, and 865,386 kg from Zimbabwe.
The PTA chief said: "No country except Kenya can meet our demands. We have to work hard to find alternative sources, and any overnight decision may hurt the interest of Pakistan."
"We do not have enough tea stock due to long winter season this year, and we are not in a position to import tea from any other country at the same rates", he said, adding "We have to pay more if we see any other market, and if we pay only 50 cents per kg more we would be paying $6 million per month in excess for 12.3 million kilogram tea."
He said Bangladesh produces 55 million kilograms annually and Pakistan can import 10 million kilograms of tea without duty under the Free Trade Agreement (FTA).
India is the largest tea producing country in the world as it produces 90 million kilograms of tea per annum, but it consumes its 75 percent tea in its own country, and Pakistan cannot depend on remaining 25 percent of its production, he said, adding: "Tea rates in India are also high as compared with Kenya and we have to pay 50 to 60 cents per kilogram more in case of deal with it.
Altaf suggested that the government should sign free trade agreements with other countries to overcome the increasing prices of tea, saying the FTA could also be signed with Kenya, and it should be given preference to sign FTA because Kenya is the biggest tea producing country.
The illegal import of tea is another problem for Pak tea importers and a huge quantity of tea is being imported by illegal channels even after the decrease in import duty, he said, adding the genuine tea importers have to pay 34 percent of their total expenditures as duties, sales tax and income tax, while the tea smugglers' expenditures are only 12 percent.
He also suggested that the government should think about it, and the import duty should be revised. The sales tax should also be revised to 10 percent from 15 percent.
Pakistan tea imports could be increased by 150 million kilograms through legal channel as 118 million kilograms of tea were imported in 2004, he added.