Pakistan cuts duty for meat industry equipment

12-Jun-2016 - Last updated on 13-Jun-2016 at 10:02 GMT

Reforms to Pakistan's import duty could triple halal meat production in the future

The Pakistan government has reduced custom duty on machinery imports used in the livestock and meat industry from 5% to 2% to encourage investment in the meat industry.

Incubators, brooders and animal feedstuffs machinery are among the imports that will see duties reduced.

The move follows calls from Pakistan’s meat production and livestock industry for the government to abolish custom duties imposed on imports of the latest meat and livestock production machinery and equipment.

Their calls were answered when Prime Minister Nawaz Sharif instructed the country’s finance ministry to give relief to Pakistan’s growing meat and livestock industry in the federal budget for 2016-17, released on June 3.

Help for Halal

“The reduction of custom duty will reduce the cost of imported machinery. It will become easier for us to establish meat plants on modern lines,” said Mumtaz Alam, a Lahore-based halal meat exporter and owner of the Alam Food Processing Unit.

The tariff cut follows an announcement by the Sharif government last June (2015) for a four-year tax exemption for companies setting up halal meat production plants in Pakistan. Only those companies which set up a halal factory and obtain halal certification by December 31 (2016) are eligible.

Alam said that with these two reforms, Pakistan can potentially triple the size of its halal production in coming years.

Steady growth

Pakistan’s meat exports reached US$243.5m in 2015, according to data from the country’s ministry of national food security and research. In the 2012-13 financial year, Pakistan exported mutton worth US$79.4m and US$111.2m of beef in 2012-13. Major international markets for Pakistani mutton and beef include the United Arab Emirates (UAE), Saudi Arabia, Iran, Kuwait, Oman and Qatar.

According to the ministry, Pakistan’s meat and livestock sector has been growing steadily in size over the past 23 years and in 2015 had 169 million head of animal livestock in commercial operations, including 74 million cattle and buffalo and 95 million sheep and goats. Pakistan produced 650,402 tonnes of chicken meat, 73,000t buffalo meat, 70,600t of cattle meat, 270,000t of goat meat and 154,000t of sheep meat.

Exports of halal meat and meat preparations from Pakistan increased from US$70.9m in 2008-09 to US$210.9mn in 2012-13, according to ministry figures, which also said that Pakistan currently ranks 18th in the production index of the halal meat market worldwide, with an annual output of 2.2 million tonnes, commanding a 2.9% share in global production.