Iran to lift ban on rice import from Pakistan

LAHORE: Iran has agreed to lift ban on rice import from Pakistan against the backdrop of gradual removal of international sanctions and the rice export will restart from October 2015.
The decision was taken in a high level meeting with Iranian government department including General Trading Corporation of Iran, ministry of agriculture, livestock department, minister for industries Iran, minister of economic affairs and finance with a Pakistani delegation.
Pakistani delegation is currently in Iran to finalise the modalities of the revival of rice export from Pakistan to Iran. The delegation is visiting on the directives of Punjab Chief Minister Shahbaz Sharif while Punjab Board of Investment and Trade in consultation with the Iranian Consulate in Lahore coordinated this three-day visit.
Pakistani delegation is led by provincial Food Minister Bilal Yasin along with Farrukh Javed, minister for agriculture, Muhammad Anjum, director general Agriculture Extension, Abdul Basit, chairman PBIT, Nasim Sadiq, secretary livestock and industries confirmed that the rice export will start from October.
Purpose of the delegation’s visit is to plan for the upcoming chief minister’s visit to Iran. After rice, it has also agreed with the General Trading Corporation of Iran that other goods should be imported from Pakistan. This has also decided that trade route should be developed from which both the countries would benefit and the illegal trade of goods should be eliminated.
Earlier, in November 2014 a 19-member Iranian Rice Importers Association delegation visited Lahore in which they visited different rice mills, farms and laboratories in perspective of Pak-Iran mutual rice trade business.
Iran is the one of the largest rice importer of the world, as it imports around 11 percent of the world rice worth $2.5 billion.
According to the International Trade Centre, the demand for rice in Iran has doubled during 2012-13 and in the last five years, import of rice grew more than 35 percent. Hence, there exists a huge opportunity for the exporters of Pakistani rice.
Pakistan is the fourth largest exporter of rice in the world with exports of more than $2 billion. Before imposition of sanctions on Iran, Pakistan was the largest exporter of rice to Iran which it has lost to India. Currently, almost 90 percent of rice is from India although import from Pakistan is more economical.
India has captured this market as no sanctions were imposed on it by the US under the head of food versus oil programme.
Under the programme, India can export food grains and medical supplies to Iran in exchange of oil purchase. However, Pakistan’s trade was routing through Bank of New York, which was suspended by the US. Hence, Pakistan was deprived of its niche rice market of Iran which resulted in crashing of local rice price and paddy growers incurred huge losses in their crops.
Rice Exporters Association of Pakistan (REAP) former chairman Sami Ch welcomed Iranian government decision of lifting import ban from Pakistan’s rice.
However, he believed that the decision will remain ineffective until proper currency transfer arrangement with Bank of New York will not restore. “Only effective, efficient and reliable formal banking channel of currency transfer is vital,” he added. He said the visiting delegation should consult with stakeholders before going to Iran on revival of rice export from Pakistan. “Outcome of the meeting could be more effective and could be smoother if the stakeholders were consulted,” he observed.