High import valuation of duty on onyx from Afghanistan dragged down export of value added onyx products by 26 percent to $24.25 million in July-Jan 2017.
Ignoring all stakeholders the actions of the Federal Board of Revenue (FBR) and Pakistan Customs for duty revision has negatively impacted exporters who add value to onyx to export it from Pakistan, has caused foreign exchange losses, exporters said.
Valuation of importing onyx to $250 per metric tonne from $55 per metric tonne, a more than 200 percent increase has irked exporters and importers.
FBR and Customs’ unilateral decision without considering its negative impact on re-export of marble products from Pakistan has adversely affected exports and increased input costs.
Pakistan is importing onyx from Afghanistan to export after its value addition to various countries. After this unwise imposition of duty on imports from Afghanistan, exports from Pakistan witnessed a decline and stood at only $24.25 million, Sanaullah Khan Chairman, All Pakistan Marble Mining, Processing, Industry and Exporters Association (APMMPIEA) said.
“This is major reason for decline in exports and APMMPIEA suggested to FBR and Customs to reconsider the import value $55 to $75 per tonne, about 95 percent increases of the import value”, he remarked.
The onyx imported from Afghanistan should be exported at the rate of $150 to $250 cost and freight (C&F) anywhere in the world and H S Code 6802 and 6815 should be applied, Sanaullah suggested.
We also suggest Trade Development Authority of Pakistan (TDAP) to recommend all concerned authorities that block export or import should only be allowed to manufacturers, excluding traders.
The export of marble should be at the rate $70 to $100 C&F anywhere in the world and the H S Code 2515 should be applied, he asked tax authorities. The TDAP offered adhoc relief at 1 percent of export value in 2012 and
5 percent rebate to this sector for increasing the export of marble, onyx and allied products.
APMMPIEA asked TDAP to update its website with the current addresses and contact details of Associations’ members of the sector. Marble export from Pakistan during July 2016 to January 2017 was made under HS code 2515 $14,282,741.77, HS code 2516 $00, 571,092.13, HS code 2517 $00, 595,821.22, HS code 6802 $ 4,456,078.62 and HS code $ 4,339,873.88. He said mining and excavation activities are running at normal at major deposits around the world and for quality marble and granite in Mohmand, Khyber, Bajour and Kurram agencies of Federally Administered Tribal Areas (FATA).
The stakeholders and licensed miners were working to normalise activities at the major zones where huge quantities of marble are extracted. These deposits have a great variety of colours and fabrics and thus have vast potential in the international market. He said around 1.5-2.0 million square feet stone of all qualities monthly was excavated for the use of local marble units in the country.
The government has set an export target $80 million to be achieved by 2018 from export of marble and granite when all projects relating to the establishment of Model Quarries and Marble Cities initiated by Pakistan Stone development Company would be completed. The marble and granite sector is serving as an engine of development, economic growth and poverty alleviation. More than 7,000 million tonnes of good quality marble ranging from super white, silky and grey varieties exist in Mohmand, Khyber and Bajaur agencies, Sanullah Khan said.
He said the country is in a position to generate around $70 million per annum from the export of raw marble and granite only from this project. If the marble and granite further processed, then the government would be able to get an addition amount of $14 million from its exports.
He said almost 80 percent of marble in Pakistan is wasted due to conventional blasting and lack of proper facilities and after allowing machinery, equipments and spares imports from India, the sector would develop its capability to 70 percent. Mining and quarry contribute nearly 0.5 percent to Pakistan’s Gross Domestic Products (GDP) with an estimated value addition of Rs 16 billion.
Khan said global trade in marble and granite is estimated at $42 billion annually. He said Pakistan remains a marginal market player with exports stagnant at about $54-$55 million largely due to unpredictable supply of raw material as well as the inability to cater high volume orders.
Chinese firms are showing great interest in Pakistani marble for its quality and cost effectiveness in the international market. He said, “USA is eyeing on Swat district, Bajaur agencies and NWFP where we have million tonnes of deposit of marble and chromite”. This is black colour stone and contains around 55 percent steel properties and used in steel making and steel material for tank making, he added.
By Razi Syed