FMCG shortage looms as govt stiffens labelling rulesArchive
KARACHI: Imports of fast moving consumer goods (FMCGs) have suffered a major setback after the Ministry of Commerce issued an SRO237 on Feb 19 mandating importers to print details and ingredients of the food products in Urdu and English on consumer packaging.
Under the SRO, all importers have also been asked to ensure that “the logo of the Halal certification body shall be printed on the consumer packaging ... and the labelling shall not be in the form of a sticker, overprinting, stamp or scratched labelling.”
“The shipment shall be accompanied by a ‘Halal Certificate’ issued by a Halal Certification Body,” the SRO adds.
A number of importers have asked their foreign suppliers to put their shipment on hold following the issuance of SRO by the ministry relating to Halal Certificate, labelling, expiry date etc on imported items. Besides, many importers have already stopped making future imports.
Moreover, the SRO order has also increased the shelf life remaining on the product upon its import to 66 per cent from 50pc.
“I import olive oil and am required to produce halal certification for it?” an agitated importer tells Dawn. Other product lines such as breakfast cereals, olives and olive oil, honey, canned fruits, sweet corns, cheese and all other imported food stuffs have been affected.
Another importer of olives, olive oil, canned fruits and vegetables, pastas, creams etc, who asked not be named, said that “I have not cleared four of my containers from the port since Feb 19 while four more are expected to dock next week.”
He added that other importers have also been unable to clear their shipments, while many traders, whose containers are on the high seas, are equally perturbed.
He said importers need to line-up food item imports from various countries with a time frame of 25-35 days to reach Pakistan. Consumers may face serious shortage of imported FMCGs during Ramazan — expected in second week of May — in case, the matter is not resolved. He added that many importers have cancelled their contracts with foreign suppliers.
Most people contacted by Dawn agreed that the real intent of the said order is to limit imports of what the government considers to be ‘non-essential items’, and the SRO is designed as a non-tariff barrier rather than any certification or labelling requirement.
Former Karachi Chamber of Commerce and Industry (KCCI) president Haroon Agar said importers are in a quandary as the ministry’s order does not carry any implementation date but it has been enforced by relevant authorities from Feb 19.
Importers are not opening new letters of credit or entering into bank contracts for future trade. As a result, the markets may face severe shortage of FMCGs in coming days.
Agar said Pakistan imports various varieties of packed food items worth $1.5-2 billion per annum, some of which he claims are a necessity for many people instead of a luxury. He said Halal and labelling issues are creating serious problems for the importers but “we can manage expiry date issue.”
KCCI President Junaid Makda said he had complained to Adviser to Prime Minister Abdul Razak Dawood for not taking business community into confidence before issuing the SRO on due to which importers have suffer losses and suspend future imports.
“The main aim of the move is to slow down imports drastically otherwise many edible items are basic needs of our people instead of luxury spending,” he added.
The SRO, he said, has created a lot of confusion and anxiety in the business community due to the absence of implementation date. As a result, the date of issue would be interpreted as the effective date and customs officials at various levels would hold the clearance of cargo on the pretext of seeking clarification from the Federal Board of Revenue. It would lead to delays and resulting costs of demurrage and detention to the importers.
Published in Dawn, March 19th, 2019