Smuggled tea captures market
May 02, 2009
KARACHI: Over 80 per cent of tea trade in Jodia Bazar, the biggest centre of wholesale business in Pakistan, is in one way or the other related to smuggling through the Afghan Transit Trade (ATT) arrangement, The News has learnt.
The government included tea in the ATT in 2004 which has actually pushed illegal trade between Afghanistan and Pakistan to new highs.
A tea wholesaler told The News “smuggled tea is involved in over 80 per cent of total dealings in Jodia Bazaar. Moreover, if the government did not take measures to end the smuggling, the remaining 20 per cent legal importers would also leave the market as they have no other alternative.”
Muhammad Qasim, a tea importer, wholesaler and retailer said: “It is not just tea, but there are a number of other items that are smuggled into Pakistan through the Afghan Transit Trade (ATT).
There are black sheep in the government and these officials also help this illegal trade make huge money.
“We import tea from China, Vietnam, Kenya and other countries. Many shop-owners, who are running their family businesses since before the partition of sub-continent, say their businesses have been ruined by smuggling which has been going on for the last 15 years.
“On import, the government gets more taxes, then why it does not stop the smuggling,” he said, adding “we have been meeting high officials of the Federal Board of Revenue (FBR) and Customs but nothing has been achieved.
These officials do not bother to take notice of this illegal trade. We have also invited press and media to witness these activities in the market but it seems that all our efforts go in vain.”
When asked what the Pakistan Tea Association (PTA) was doing to save this trade, another tea dealer replied: “Our businesses have been shattered and I do not think that despite efforts the Pakistan Tea Association has been able to achieve desired results.”
Businessmen, who deal in tea, said some elements in the government were definitely involved in these activities, otherwise that huge illegal trade would not have been possible.
Importer Mohammad Qasim said, “we used to supply our products all over Pakistan including Bannu, Mardan, Quetta, Peshawar and other far-flung areas, but now with rising tea smuggling under ATT, our trade is restricted to Karachi only because end-users in the upcountry get smuggled tea at prices lower than ours.”
“Jodia Bazaar was the hub of legal tea trade and a huge number of traders and buyers came here but smuggled tea has now virtually replaced the legal business.
Smuggled tea has reached all corners of the country and has established a niche owing to comparatively low prices,” he argued.
However, he admitted that over a period of time consumer confidence in company-packed teas had increased compared to low-quality loose tea. “We as professionals know how much unhealthy things are being mixed in loose tea by some unscrupulous elements for which we demand the government curb these activities and smuggling.”
He demanded the government should reduce duties on tea as only when the tea dealers could be able to compete with smugglers, “though we do not hope the government would do something in this regard.”
“If any government official tries to initiate a crackdown on this illegal business, he is transferred within a month which is why businessmen are disappointed,” he said.
Smuggling through the Afghan border is not a new phenomenon.
If a legal tea importer leaves the market, the smuggler would capture his share. Because of indifferent attitude of the government to illegal trade and smuggling, people are now fast becoming disheartened, businessmen lament.
A small tea importer and retailer, on condition of anonymity, said he did not think that smuggling was affecting his business. He maintained tea could be stored up to three years with all its freshness and taste, but after that the taste would be affected. “In summer, tea consumption drops because people consume cold drinks more, and this is also the basis of low demand and sales,” he added.
The government included tea in the ATT in 2004 which has actually pushed illegal trade between Afghanistan and Pakistan to new highs.
A tea wholesaler told The News “smuggled tea is involved in over 80 per cent of total dealings in Jodia Bazaar. Moreover, if the government did not take measures to end the smuggling, the remaining 20 per cent legal importers would also leave the market as they have no other alternative.”
Muhammad Qasim, a tea importer, wholesaler and retailer said: “It is not just tea, but there are a number of other items that are smuggled into Pakistan through the Afghan Transit Trade (ATT).
There are black sheep in the government and these officials also help this illegal trade make huge money.
“We import tea from China, Vietnam, Kenya and other countries. Many shop-owners, who are running their family businesses since before the partition of sub-continent, say their businesses have been ruined by smuggling which has been going on for the last 15 years.
“On import, the government gets more taxes, then why it does not stop the smuggling,” he said, adding “we have been meeting high officials of the Federal Board of Revenue (FBR) and Customs but nothing has been achieved.
These officials do not bother to take notice of this illegal trade. We have also invited press and media to witness these activities in the market but it seems that all our efforts go in vain.”
When asked what the Pakistan Tea Association (PTA) was doing to save this trade, another tea dealer replied: “Our businesses have been shattered and I do not think that despite efforts the Pakistan Tea Association has been able to achieve desired results.”
Businessmen, who deal in tea, said some elements in the government were definitely involved in these activities, otherwise that huge illegal trade would not have been possible.
Importer Mohammad Qasim said, “we used to supply our products all over Pakistan including Bannu, Mardan, Quetta, Peshawar and other far-flung areas, but now with rising tea smuggling under ATT, our trade is restricted to Karachi only because end-users in the upcountry get smuggled tea at prices lower than ours.”
“Jodia Bazaar was the hub of legal tea trade and a huge number of traders and buyers came here but smuggled tea has now virtually replaced the legal business.
Smuggled tea has reached all corners of the country and has established a niche owing to comparatively low prices,” he argued.
However, he admitted that over a period of time consumer confidence in company-packed teas had increased compared to low-quality loose tea. “We as professionals know how much unhealthy things are being mixed in loose tea by some unscrupulous elements for which we demand the government curb these activities and smuggling.”
He demanded the government should reduce duties on tea as only when the tea dealers could be able to compete with smugglers, “though we do not hope the government would do something in this regard.”
“If any government official tries to initiate a crackdown on this illegal business, he is transferred within a month which is why businessmen are disappointed,” he said.
Smuggling through the Afghan border is not a new phenomenon.
If a legal tea importer leaves the market, the smuggler would capture his share. Because of indifferent attitude of the government to illegal trade and smuggling, people are now fast becoming disheartened, businessmen lament.
A small tea importer and retailer, on condition of anonymity, said he did not think that smuggling was affecting his business. He maintained tea could be stored up to three years with all its freshness and taste, but after that the taste would be affected. “In summer, tea consumption drops because people consume cold drinks more, and this is also the basis of low demand and sales,” he added.
