Tea smuggling causing loss of billions to local market
KARACHI: The local markets of tea are facing loss amounting to billions of rupees as a result of tea being smuggled to Pakistan from Afghanistan. According to Pakistan Tea Association, the country’s total tea consumption stands at 175 million kilograms. Out of this 100 million kgs are imported through government channels while the rest that is 75 million kgs is smuggled to Pakistan from Afghanistan. Pakistan perhaps is among the few countries where tea has attained the status of basic food especially among the poor. While it is used as a source of entertainment by all segments of the society, it is essentially required at the breakfast especially in the urban areas of Pakistan.
This causes a loss of Rs5.5 billion to the local importers of tea, it said. The association has called for immediate attention of the government to the issue and demanded withdrawal of 10 per cent import duty on tea to resolve the problem.
Since the smuggled tea evades duties and taxes it is sold at a discount. This type of incentive is becoming a great source of attraction even for the legal tea importers and a large number of them have naturally diverting their buying towards the smuggled tea. If this trend is allowed to prevail the tea business is likely to be the haven of the smugglers.
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