GI tags, certification to help Pakistan fetch higher exports: SBP

KARACHI: The geographical indications (GI) tagging can potentially have a beneficial impact on Pakistan’s exports by creating a distinct market identity of some export items, thereby allowing exporters to get higher unit prices and contribute to the country’s foreign exchange earnings, the central bank said.

“The recent measures taken by Pakistan to put in place the needed legal and regulatory framework for GI tagging are a step in the right direction,” the State Bank of Pakistan (SBP) said in its latest second quarterly report on the state of Pakistan's economy for the fiscal year 2020/21.

“That said, Pakistan also needs to expedite the domestic registration of other exportable and GI-worthy products.”

In the case of Pakistan, a recent case in GI tagging is that of the basmati rice. This aromatic rice variety is considered one of the world’s most premium, and is produced and exported by only two countries – Pakistan and India, it said.

The quality of basmati rice is reflected in its much higher unit values vis-à-vis non-basmati rice varieties. Since September 2020, however, the two countries are engaged in a legal process that is playing out in the European Union over the usage of the “basmati” label, it added.

Geographical indications are defined by Article 22 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (WTO) as: “indications which identify a good as originating in the territory of a Member (of the WTO), or a region or locality in that territory, where a given quality, reputation or other characteristic of the good is essentially attributable to its geographical origin.”

In October 2020, the government announced a ‘non-exhaustive indicative list of prospective geographical indications’ that included 79 assorted items at the time.

These products have the potential to increase the country’s export earnings, mainly by fetching premium prices, and from increased market access and endorsements by international companies and brands.

Furthermore, higher sales of these products would also contribute towards rural development and employment, according to the report.

There are a number of goods, both natural and manufactured, in Pakistan that carry unique characteristics because they are exclusively borne out of a particular locality, climate, set of traditions and/or a group of people. These include, but are not limited to, Basmati rice, Khewra pink salt, Swat peaches, Sindhri mangoes, Qasuri haldi/methi, Peshawari chappal, Multan blue pottery, truck art, and Sindhi ajrak. However, lacking awareness, resources, and business management and product marketing skills, the producers and/or exporters of these products generally neglect to build a brand, or register for appropriate rights to protect their products in the international market from counterfeiting and other infringements, the report said.

GI tags are generally used by the governments to prevent manipulation of domestic products by foreigners. The process is as follows. First, the government sanctions these tags to the products in light of national legislation on protection of intellectual property. Afterwards, they apply for protection in other countries.

Pakistan introduced its own comprehensive GI law in March 2020; until then, the country lacked legal grounds to protect its products, both within and beyond its borders.

Once established, the national GI tags can be extended internationally through four channels: a) by providing direct protection in the concerned jurisdiction; b) by concluding agreements with other states or commercial partners; c) through the Lisbon Agreement for the Protection of Appellations of Origin and their International Registration; and d) via the Madrid System for the International Registration of Marks, the SBP report said.