ISLAMABAD: Horticulture exporters have approached the Secretary of the Ministry of Commerce, highlighting the challenges they encounter in realizing their export proceeds. They have appealed for an extension of the repatriation time limit to address the unique difficulties faced in their industry.
In a recent letter addressed to the Secretary of Commerce, the Pakistan Fruit and Vegetable Exporters, Importers, and Merchant Association shed light on the obstacles they confront when attempting to meet the stipulated time frames for export proceeds. The exporters have requested an extension of the repatriation time to 120 days, taking into account the distinct characteristics of the fruit and vegetable sector.
The letter highlighted the application of lien percentages mentioned in FE Circular No. 02 of 2023, dated March 31, 2023, and SBP Circular No. EPD/ITD/Exports/302304/2023 dated April 30, 2023. The exporters expressed concern over being compelled to pay penalties ranging from 3% to 9% for delayed payments.
Due to the perishable nature of horticulture products, shipments of fruits and vegetables are often conducted on a “Documents against Payment” (DP) basis. This is primarily because banks do not offer long tenures, especially to low-volume exporters in the horticulture sector. Consequently, exporters face challenges in meeting the mandated 45-day repatriation period, considering the long transit time of shipments and the time required to sell the produce.
The association emphasized the need for specific provisions in the State Bank of Pakistan (SBP) manual to facilitate the export of fresh produce in the fruit and vegetable sector. They further mentioned that exporters often ship their consignments based on open prices, making it difficult to obtain the full value of the consignment. Additionally, factors such as decay, diseases, container malfunctions, loss of debt, and other issues may lead to losses that cannot be repatriated.
In light of these challenges, the horticulture exporters have urged the authorities to extend the time limit for repatriation to 120 days for fruits and vegetables. They believe that such an extension would enable them to navigate the unique circumstances of their business and contribute to the growth and development of the export sector.
The exporters expressed hope that the Ministry of Commerce, acknowledging the distinctive nature of the horticulture sector, would consider their request and create a more favorable environment for exporters. They emphasized that facilitating the realization of export proceeds within a reasonable timeframe would significantly contribute to the growth of the country’s export sector.
