Study on Sourcing Opportunities in Pakistan

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Study on Sourcing Opportunities in Pakistan
Nov, 2019

www.dragonsourcing.com© 2019 Dragon Sourcing. All rights reserved. 2
Table of Contents
▪ Executive Summary
▪ Pakistan – An Overview
▪ Top Export Categories
▪ Made-up Textiles
▪ Cotton
▪ Knitted Apparel
▪ Woven Apparel
▪ Cereals
▪ Leather Products
▪ Sugars & Sugar Confectionary
▪ Optical Products & Accessories
▪ Fish
▪ Salt, Lime & Cement
▪ Beverages, Spirits & Vinegar
▪ Fruits & Nuts
▪ Raw hides, Skins & Leather
▪ Trade Agreements

Executive Summary- Top Export Categories (1/2)
3
Category
HS
Series
2017
Export
Value in
USD
Billions
Pakistan’s
share of
Global
Exports
(2017)
Category‘s
share of
Total
Pakistan
Exports
(2017)
Top Products under category Top Export Destinations
Import Duty
into US
Import Duty
into EU
Made-up
Textiles
63 3.9 6% 18%
Bed linen
Textiles
Curtains
USA, UK, Germany 0%-20.9% 0%-12%
Cotton 52 3.5 6% 16%
Cotton yarn
Woven cotton fabrics
China, Bangladesh,
Turkey
0%-12% 0%-5%
Knitted
Apparel
61 2.5 1% 11%
Men's/boy's shirts, suits, ensembles,
jackets, blazers, trousers
Pantyhose, tights, stockings, socks
USA, UK, Germany 0%-28.2% 0%-12%
Woven
Apparel
62 2.5 1% 11%
Men's/boy's ensembles
Women's/girl's suits, ensembles
USA, Germany, Spain 0%-27.7% 0%-12%
Cereals 10 1.8 2% 8%
Rice
Maize or corn
Wheat and meslin
Kenya, UAE, Afghanistan 0%-11.2% 0%-12.8%
Leather
Products
42 0.6 1% 3%
Apparel & clothing accessories
Trunks, suitcases, vanity cases
Germany, USA, UK 0%-20% 0%-9.7%
Sugars &
Sugar
Confectionery
17 0.5 1% 2%
Cane or beet sugar
Sugar confectionary
Afghanistan, USA, Saudi
Arabia
0%-12.2% 0%-20%
© 2019 Dragon Sourcing. All rights reserved.

Executive Summary- Top Export Categories (2/2)
4
Category
HS
Code
2017
Export
Value in
USD
Billion
Pakistan’s
share of
Global
Exports
(2017)
Category‘s
share of
Total
Pakistan
Exports
(2017)
Top Products Top Export Destinations
Import Duty
into US
Import Duty
into EU
Optical
Products &
Accessories
90 0.4 0.1% 2%
Medical Instruments
Surveying , geophysical instruments
Oscilloscopes
USA, Germany, China 0%-7% 0%-2.9%
Fish 03 0.4 0.3% 2%
Frozen Fish
Crustaceans
Fish fillets
Vietnam, Thailand, China 0%-3% 0%-16%
Salt, Lime &
Cement
25 0.39 1% 2%
Cement
Natural steatite
Salt
Afghanistan, India. China 0%-3% 0%
Beverages,
Spirits &
Vinegar
22 0.38 0.3% 2%
Ethyl alcohol
Mineral & Aerated waters
South Korea, Netherlands,
Philippines
0%-17.5% 0%-9.6%
Fruits & Nuts 08 0.35 0.3% 2%
Dates
Citrus Fruits
Dried apricots, prunes, apples, peaches,
pears, papayas
India, Afghanistan, Russia 0%-29.8% 0%-5.6%
Raw hides,
Skins &
Leather
41 0.34 1% 2%
Bovine leather
Goat, Pigs, Reptiles leather
Sheep/lam leather
Italy, China, Vietnam 0%-4.2% 0%

3.80
3.50
2.35
2.25
1.72
0.64
0.25
0.36
0.34
0.45
0.25
0.44
0.35
3.96
3.50
2.52
2.47
1.75
0.63
0.51
0.41
0.41
0.39
0.38
0.35
0.34
0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50
Made-up textile Products
Cotton
Knitted Apparel
Woven Apparel
Cereals
Leather Products
Sugars & Sugar Confectionary
Optical Instruments
Fish
Salt, Lime & Cement
Beverages, spirits and vinegar
Fruits & nuts
Raw hides, Skins & Leather
Top Export Categories from Pakistan
(Values in USD Billion)
2017 2016
Y-O-Y Growth of Top Export Categories
5
Source: International Trade Centre
Top 13 export categories contributes to about 80% of the total exports value from Pakistan
▪ Semi-milled or wholly milled rice and Cotton bed linen have an export potential that is not fully tapped of about USD 870 million and USD
429 million respectively.
▪ Other potential products that are not completely tapped into include Toilet/kitchen linen, Cotton men’s trousers and shorts, Portland
Cement, Leather apparels etc.
22.1 20.5 21.9
44.0 47.0
57.4
0.0
10.0
20.0
30.0
40.0
50.0
60.0
2015 2016 2017
Pakistan - Export and Import Statistics
(in USD Billion)
Total Exports from Pakistan Total Imports into Pakistan
3.4
1.6 1.6 1.4 1.2
3.6
1.6 1.5 1.4 1.3
0.0
2.5
5.0
USA UK China Afghanistan Germany
Top Importing Markets for products exported by
Pakistan (in USD Billion)
2016 2017

PAKISTAN – AN OVERVIEW
6

– Pakistan is the country in South Asia
+ Population- 214 million (2017 estimate)
+ Surface area ~881,913 km2
+ Coastline about ~1,046 km
Pakistan – Country Overview
7
Population (2017) Area (km2)
Azad Jammu and
Kashmir
4.05 million 13,297
Balochistan 12.3 million 347,190
Gilgit-Baltistan 2.44 million 64,817
Islamabad Capital 2.00 million 906
Khyber Pakhtunkhwa 35.52 million 101,741
Punjab 110.01 million 205,344
Sindh 47.88 million 140,914
Growth Value (2017)
Gross Domestic Product
2017: 5.4%
2018 (E): 5.8%
2019 (E): 5%
2020 (E): 5.4%
USD 304.95 billion
Exports 2016-2017: 7% USD 21.9 billion
Foreign Direct Investments Jul 2017-Jun 2018: 1.86% USD 2.81 billion
Source: International Trade Centre, worldbank.org, World Economic Forum

TRADE STATISTICS OF TOP
EXPORT CATEGORIES
8

1.4
0.6
0.3
0.2 0.2
1.3
0.6
0.3
0.2 0.2
1.4
0.6
0.3
0.2 0.2
0.0
2.0
USA UK Germany Netherlands Belgium
Top Importers of HS 63 series (Made-up Textiles)
from Pakistan in USD billion
2015 2016 2017
3.9 3.8 3.8 4.0
0.0
2.5
5.0
2014 2015 2016 2017
Export of HS 63 series (Made-up Textiles) from
Pakistan in USD billion
26, 42%
5, 8%4, 6%
3, 5%
2, 3%
23, 36%
World Export of HS 63 series (Made-up Textiles)
in USD billion in 2017
China India Pakistan Germany USA Others
Top Exported Products in this Category
▪ Bedlinen, table linen, toilet linen and kitchen linen of all types
of textile materials (excluding floor cloths, polishing cloths,
dishcloths and dusters)
▪ Made-up articles of textile materials, incl. dress patterns
▪ Curtains, incl. drapes, and interior blinds; curtain or bed
valances of all types of textile materials (excluding awnings
and sun blinds)
Made-up Textiles (1/2)
9

▪ Pakistan was the 3rd largest exporter of
made-up textiles in the world in 2017,
followed by China and India
▪ Made-up textiles contributes to about
18% of total exports from Pakistan in
2017
▪ Textile products from Pakistan has a
huge customer base in the EU, USA,
Middle East and Africa. However, high
cost of production is reducing the
industry’s competitiveness amongst other
regional competitors.
▪ Exporters view governance and
business-unfriendly policies as major
threats to the industry
Made-up Textiles (2/2)
10
Major Clusters of Bed Linen in Pakistan
Source: tribune.com.pk, thenews.com.pk
Karachi
Lahore
Faisalabad
Multan
Hyderabad

1.3
0.6
0.1 0.2 0.1
1.0
0.6
0.1 0.2 0.1
0.9
0.5
0.2 0.2 0.1
0.0
1.0
2.0
China Bangladesh Turkey Italy Portugal
Top Importers of HS 52 series (Cotton) from
2015 2016 2017
4.7
4.0
3.5 3.5
0.0
2.0
4.0
6.0
2014 2015 2016 2017
Export of HS 52 series (Cotton) from Pakistan in
USD billion
15, 27%
8, 14%
7, 12%3, 6%
3, 5%
20, 36%
World Export of HS 52 series (Cotton) in USD
billion in 2017
China USA India Pakistan Vietnam Others
▪ Cotton yarn other than sewing thread, containing >= 85%
cotton by weight (excluding that put up for retail sale)
▪ Woven fabrics of cotton, containing >= 85% cotton by weight
and weighing > 200 g/m²
▪ Woven fabrics of cotton, containing >= 85% cotton by weight
and weighing <= 200 g/m²
Cotton (1/2)
11

▪ Pakistan is the 5th largest producer and
4th largest exporter of Cotton in the world.
Cotton production in Pakistan amounted
to around 1.8 million metric tons in
2017/2018.
▪ Cotton is considered as one of the major
economy driver and production of cotton
supports Pakistan’s largest industrial
sector
▪ The country missed the cotton production
target by a wider margin of 30% and 25%
in FY16 and FY17 respectively.
However, Although it grew considerably
in FY18 it still missed target by 8% in
FY18
▪ Although, over 50 million tons of cotton
seeds are produced annually, only less
than 1% is used to plant cotton. The rest
goes as livestock feed. More farmers are
looking to plant mutant variety seeds of
cotton to increase yield.
Cotton (2/2)
12
Major Cotton Production Zones in Pakistan
Source: Pakistan Cotton Ginners Association, All Pakistan Textile Mills Association, statista.com, International Atomic Energy Agency, tns.thenews.com.pk
Punjab Province
Sindh Province

2.4 2.4 2.3
2.5
0.0
1.5
3.0
2014 2015 2016 2017
Export of HS 61 series (Knitted Apparel) from
1.0
0.4
0.1 0.1 0.1
0.9
0.4
0.2 0.2
0.1
0.9
0.4
0.2 0.2 0.2
0.0
0.5
1.0
1.5
USA UK Germany Spain Netherlands
Top Importers of HS 61 series (Knitted Apparel)
2015 2016 2017
72, 32%
18, 8%
13, 6%
10, 4%
3, 1%
110, 49%
World Export of HS 61 series (Knitted Apparel) in
USD billion in 2017
China Bangladesh Vietnam Germany Pakistan Others
▪ Men's or boys' shirts, knitted or crocheted (excluding
nightshirts, T-shirts, singlets and other vests)
▪ Men's or boys' suits, ensembles, jackets, blazers, trousers, bib
and brace overalls, breeches and shorts (excluding wind-
jackets and similar articles, separate waistcoats, tracksuits, ski
suits and swimwear)
▪ Pantyhose, tights, stockings, socks and other hosiery, incl.
graduated compression hosiery [e.g., stockings for varicose
veins] and footwear without applied soles, knitted or crocheted
(excluding for babies)
Knitted Apparel (1/2)
13

▪ Export growth of knitted apparel is
hindered due to continued economic
volatility, rising cost of doing business
and foreign exchange rate constraints.
▪ In order to increase the growth of this
sector, in August 2018, the government
has announced duty drawback of taxes
collected from garments, home textiles
and processed fabric to manufacturing
and exporting units and commercial
exporters.
▪ Ministry is also investing in training the
textile sector workers
Knitted Apparel (2/2)
14
Major Garment Production Zones in Pakistan
Source: textile.gov.pk, fibre2fashion.com
Karachi
Lahore
Faisalabad
Sialkot

0.5
0.3
0.3 0.3
0.1
0.5
0.3 0.3 0.3
0.2
0.5
0.3 0.3
0.3
0.2
0.0
0.2
0.4
0.6
USA Germany Spain UK Belgium
Top Importers of HS 62 series (Woven Apparel)
2015 2016 2017
2.0
2.1
2.3
2.5
0.0
0.5
1.0
1.5
2.0
2.5
2014 2015 2016 2017
Export of HS 62 series (Woven Apparel) from
74, 32%
17, 7%
14, 6%
13, 6%
2, 1%
109, 48%
World Export of HS 62 series (Woven Apparel) in
USD billion in 2017
China Bangaldesh Vietnam Italy Pakistan Others
▪ Men's or boys' suits, ensembles, jackets, blazers, trousers, bib
and brace overalls, breeches and shorts (excluding knitted or
crocheted, wind-jackets and similar articles, separate
waistcoats, tracksuits, ski suits and swimwear)
▪ Women's or girls' suits, ensembles, jackets, blazers, dresses,
skirts, divided skirts, trousers, bib and brace overalls,
breeches and shorts
▪ Men's or boys' singlets and other vests, underpants, briefs,
nightshirts, pyjamas, bathrobes, dressing gowns and similar
articles (excluding knitted or crocheted)
Woven Apparel (1/2)
15

▪ Exports of woven apparel in Pakistan has
witnessed a growth at a rate of 9% in
2016-2017
▪ Government has approved about USD
0.41 billion in 2018 for the development
of the textile manufacturing industry and
the textile industry is already witnessing
an increase in exports
▪ Also, the textile machinery segment will
continue enjoying duty-free import for the
period 2017-2018
Woven Apparel (2/2)
16
Major Garment Production Zones in Pakistan
Source: apparelresources.com, profit.pakistantoday.com.pk
Karachi
Faisalabad
Sialkot

0.2
0.1 0.1
0.1
0.2
0.2
0.1 0.1
0.0
0.20.2
0.2
0.1 0.1
0.1
0.0
0.1
0.2
0.3
0.4
Kenya UAE Afghanistan Madagascar China
Top Importers of HS 10 series (Cereals) from
2015 2016 2017
2.2
1.9
1.7 1.8
0.0
0.5
1.0
1.5
2.0
2.5
2014 2015 2016 2017
Export of HS 10 series (Cereals) from Pakistan in
USD billion
19, 18%
8, 7%
7, 7%
7, 7%
2, 2%
60, 59%
World Export of HS 10 series (Cereals) in USD
billion in 2017
USA Russia India Argentina Pakistan Others
▪ Rice
▪ Maize or corn
▪ Wheat and meslin
Cereals (1/2)
17

▪ Wheat:
▪ Wheat is the major cultivated crop in
Pakistan
▪ Close to 40% of Pakistan’s cultivated
land is used for cultivating wheat
during the winter season.
▪ Rice:
▪ Rice is Pakistan’s third largest crop in
terms of area sown, after wheat and
cotton
▪ Pakistan is a leading producer and
exporter of Basmati and IRRI rice
(white long grain rice).
Cereals (2/2)
18
Major Wheat Cultivation Zones in Pakistan
Source: Global Agricultural Information Network
Punjab Province
Sindh Province

0.1
0.1
0.1 0.1
0.04
0.1
0.1
0.05
0.1
0.04
0.1
0.1
0.05 0.05
0.04
0.0
0.1
0.2
Germany USA UK Spain Netherlands
Top Importers of 42 series (Leather Products)
2015 2016 2017
0.7
0.7
0.6 0.6
0.0
0.2
0.4
0.6
0.8
1.0
2014 2015 2016 2017
Export of HS 42 series (Leather Products) from
34, 43%
9, 12%
7, 9%
4, 5%
1, 1%
23, 30%
World Export of HS 42 series (Leather Products)
in USD billion in 2017
China Italy France Vietnam Pakistan Others
▪ Articles of apparel and clothing accessories, of leather or composition
leather (excluding footware and headgear and parts thereof, and goods
of chapter 95, e.g. shin guards, fencing masks)
▪ Trunks, suitcases, vanity cases, executive-cases, briefcases, school
satchels, spectacle cases, binocular cases, camera cases, musical
instrument cases, gun cases, holsters and similar containers;
travelling-bags, insulated food or beverage bags, toilet bags,
rucksacks, handbags, shopping-bags, wallets, purses, map-cases,
cigarette-cases, tobacco-pouches, tool bags, sports bags, bottle-cases,
jewellery boxes, powder-boxes, cutlery cases and similar containers, of
leather or of composition leather, of sheeting of plastics, of textile
materials, of vulcanised fibre or of paperboard, or wholly or mainly
covered with such materials or with paper
Leather Products (1/2)
19

▪ Pakistan is one of the leading producers
in the world of leather supply. The leather
and leather made-ups industry plays a
significant role in the economy of
Pakistan and its share in GDP is 4%.
▪ Percentage share of leather & leather
products in export performance (2016-
2017)
▪ Leather: 38%
▪ Leather Garments: 32%
▪ Leather Gloves: 20%
▪ Leather Footwear: 9%
▪ Other leather products: 1%
▪ The government removed various duties
and taxes payable on the import of shoe
manufacturing machines in 2018 and this
is expected to increase investment in this
sector
▪ The leather garments are manufactured
on small or medium scales and all
production is oriented for export which is
mainly concentrated in Karachi. The
industry is generally producing jackets
and coats.
Leather Products (2/2)
20
Major Leather Footwear Production Zones in Pakistan
Source: indonesia-investments.com, businesswire.com
Karachi

0.25
0.03
0.01 0.00
0.16
0.03
0.01 0.00
0.32
0.04 0.03 0.02
0.00
0.10
0.20
0.30
0.40
Afghanistan USA Saudi Arabia Serbia
Top Importers of HS 17 series (Sugars & Sugar
Confectionery) from Pakistan in USD billion
2015 2016 2017
0.4
0.4
0.3
0.5
0.0
0.1
0.2
0.3
0.4
0.5
0.6
2014 2015 2016 2017
Export of HS 17 series (Sugars & Sugar
Confectionery) from Pakistan in USD billion
12, 24%
3, 6%
3, 5%
2, 5%
0.5, 1%
28, 59%
World Export of HS 17 series (Sugars & Sugar
Confectionery) in USD billion in 2017
Brazil Thailand Germany France Pakistan Others
▪ Cane or beet sugar and chemically pure sucrose, in solid form
▪ Sugar confectionery not containing cocoa, incl. white
chocolate
▪ Other sugars, incl. chemically pure lactose, maltose, glucose
and fructose, in solid form; sugar syrups not containing added
flavouring or colouring matter; artificial honey, whether or not
mixed with natural honey; caramel
Sugars & Sugar Confectionary (1/2)
21

▪ Pakistan’s sugarcane production is
forecast at 72 million metric tons (MMT)
in 2018-2019, which is 12% lesser from
the previous 2017-2018 estimate
▪ Refined sugar production is forecast at
6.5 MMT in 2018-2019
▪ Apart from Punjab and Sindh provinces,
where sugarcane is cultivated at a larger
area, there is a small sugar beet industry
in the higher elevations of Khyber
Pakhtunkhwa
▪ The sugar market is insulated from
imports by a tariff of 40%.
Sugars & Sugar Confectionary (2/2)
22
Major Sugarcane Production Zones in Pakistan
Source: Global Agricultural Information Network, nation.com.pk
Punjab Province
Sindh Province

0.10
0.05
0.01
0.04
0.01
0.10
0.05
0.01
0.03
0.01
0.10
0.05
0.04
0.03
0.02
0.00
0.03
0.06
0.09
0.12
0.15
USA Germany China UK UAE
Top Importers of HS 90 series (Optical Products
& Accessories) from Pakistan in USD billion
2015 2016 2017
0.4 0.4 0.4
0.4
0.0
0.1
0.2
0.3
0.4
0.5
2014 2015 2016 2017
Export of HS 90 series (Optical Products &
Accessories) from Pakistan in USD billion
84, 14%
73, 13%
71, 12%
40, 7%
0.4, 0.1%
310, 54%
World Export of HS 90 series (Optical Products &
Accessories) in USD billion in 2017
USA Germany China Japan Pakistan Others
▪ Instruments and appliances used in medical, surgical, dental
or veterinary sciences
▪ Surveying, incl. photogrammetrical surveying, hydrographic,
oceanographic, hydrological, meteorological or geophysical
instruments and appliances
▪ Oscilloscopes, spectrum analysers and other instruments and
apparatus for measuring or checking electrical quantities
Optical Products & Accessories (1/2)
23

▪ Export of optical products & accessories
contributed to about 2% of total exports
from Pakistan
▪ Pakistan produces around 170 million
pieces every year and over 95% (60% of
disposable products & 40% of reusable
surgical instruments) of the produced
pieces are exported
▪ About 99% of the surgical instrument
production in Pakistan is centered in
Sialkot
▪ Child labor issues in the medical
instrument industry is one of the major
concerns amongst the importers of these
products from Pakistan
Optical Products & Accessories (2/2)
24
Major Medical Instrument Production Zone in Pakistan
Source: SIMAP (surgical instrument manufacturer association of Pakistan)
Sialkot

13, 11%
11, 9%
7, 6%
5, 5%
0.4, 0.3%83, 69%
World Export of HS 03 series (Fish) in USD billion
in 2017
China Norway India USA Pakistan Others
0.4
0.3 0.3
0.4
0.0
0.1
0.2
0.3
0.4
0.5
2014 2015 2016 2017
Export of HS 03 series (Fish) from Pakistan in
USD billion
0.08
0.06
0.05
0.04
0.02
0.09
0.05
0.05 0.04
0.02
0.08
0.06
0.04
0.02
0.00
0.02
0.04
0.06
0.08
0.10
Vietnam Thailand China UAE South Korea
Top Importers of HS 03 series (Fish) from
2015 2016 2017
▪ Frozen fish (excluding fish fillets and other fish meat)
▪ Crustaceans, whether in shell or not, live, fresh, chilled,
frozen, dried, salted or in brine, even smoked, incl.
crustaceans in shell cooked by steaming or by boiling in water;
flours, meals and pellets of crustaceans, fit for human
consumption
▪ Fish fillets and other fish meat, whether or not minced, fresh,
chilled or frozen
Fish (1/2)
25

▪ Pakistan’s coastal line can be divided
into two portions, being Makran Coast
and Sindh Cost
▪ Marine subsector alone is estimated at 1
million tones/year
▪ Commercially important resources
include near 250 demersal fish species,
50 small pelagic fish species, 15
medium-sized pelagic species and 20
large pelagic fish species. In addition,
there are also 15 commercial species of
shrimp, 12 of cephalopods and 5 of
lobster.
Fish (2/2)
26
Major Fish Production Zones in Pakistan
Source: karim-impex.com
Karachi
PasniGwader

0.2
0.1 0.05
0.02 0.03
0.1
0.1
0.04 0.03 0.04
0.1 0.1
0.04 0.04
0.03
0.0
0.1
0.2
0.3
Afghanistan India China USA Sri Lanka
Top Importers of HS 25 series (Salt, Lime &
Cement) from Pakistan in USD billion
2015 2016 2017
0.7
0.5
0.4
0.4
0.0
0.2
0.4
0.6
0.8
2014 2015 2016 2017
Export of HS 25 series (Salt, Lime & Cement)
3, 8%
3, 7%
3, 6%
2, 5%
0.4, 1%
31, 73%
World Export of HS 25 series (Salt, Lime &
Cement) in USD billion in 2017
China USA Turkey Germany Pakistan Others
▪ Cement, incl. cement clinkers, whether or not coloured
▪ Natural steatite, whether or not roughly trimmed or merely cut,
by sawing or otherwise, into blocks or slabs of a square or
rectangular shape; talc
▪ Salts, incl. table salt and denatured salt, and pure sodium
chloride, whether or not in aqueous solution or containing
added anti-caking or free-flowing agents; sea water
Salt, Lime & Cement (1/2)
27

▪ Pakistan’s cement industry is currently
running at 95% capacity that has
encouraged the domestic cement
manufacturers to spend an estimated
$2.25 billion on new production capacity
▪ Pakistan’s cement consumption grew
16.53% between July-August 2017.
▪ Domestic cement demand is expected to
increase by 8-8.5% per annum mainly
due to hydropower plants currently under
construction or planned as part of the
Public Sector Development Programme
(PSDP) and China Pakistan Economic
Corridor (CPEC) investments.
Salt, Lime & Cement (2/2)
28
Major Cement Production Zones in Pakistan
Source: cemnet.com, globalcement.com, profit.pakistantoday.com.pk, apcma.com
Karachi
Khyber Pakhtunkhwa
Punjab

0.1
0.02 0.02
0.01 0.01
0.1
0.03 0.02
0.01
0.00
0.2
0.05 0.04
0.02 0.01
0.0
0.1
0.2
South Korea Netherlands Philippines Spain Turkey
Top Importers of HS 22 series (Beverages, Spirits
& Vinegar) from Pakistan in USD billion
2015 2016 2017
0.4
0.3
0.3
0.4
0.0
0.1
0.2
0.3
0.4
0.5
2014 2015 2016 2017
Export of HS 22 series (Beverages, Spirits &
Vinegar) from Pakistan in USD billion
18, 16%
10, 9%
10, 8%
8, 7%
0.4, 0.3%
69, 60%
World Export of HS 22 series (Beverages, Spirits
& Vinegar) in USD billion in 2017
France UK Italy USA Pakistan Others
▪ Undenatured ethyl alcohol of an alcoholic strength of >= 80%
▪ Waters, incl. mineral waters and aerated waters, containing
added sugar or other sweetening matter or flavoured, and
other non-alcoholic beverages
▪ Waters, incl. natural or artificial mineral waters and aerated
waters, not containing added sugar, other sweetening matter
or flavoured; ice and snow
Beverages, Spirits & Vinegar (1/2)
29

▪ Consumption of alcohol is forbidden to
about 97% of the population in Pakistan
per Islamic traditions. Only locally
manufactured alcoholic drinks are
permissible to consume for the others
▪ Murree Brewery Co Ltd is the market
leader in Pakistan, producing about 10
million liters of beer each year. Annual
growth rate of the company lies between
15 and 20%.
▪ The distribution of alcoholic drinks
remains limited to food/drink/tobacco
specialists and 5-star hotels in all
provinces. In Sindh the distribution
networks are significantly stronger due to
the large number of wine shops.
Beverages, Spirits & Vinegar (2/2)
30
Major Alcohol Consumption Zones in Pakistan
Source: euromonitor.com, todayonline.com, trtapakistan.org
Sindh Province

0.1
0.1
0.05
0.05
0.01
0.1 0.1
0.05 0.05
0.01
0.1
0.1
0.03 0.03
0.02
0.0
0.1
0.2
India Afghanistan Russia UAE Indonesia
Top Importers of HS 08 series (Fruits & Nuts)
2015 2016 2017
0.4 0.4
0.4
0.4
0.0
0.1
0.2
0.3
0.4
0.5
2014 2015 2016 2017
Export of HS 08 series (Fruits & Nuts) from
15, 13%
9, 8%
7, 6%
7, 6%
0.4, 0.3%
77, 67%
World Export of HS 08 series (Fruits & Nuts) in
USD billion in 2017
USA Spain Netherlands Mexico Pakistan Others
▪ Dates, figs, pineapples, avocados, guavas, mangoes and
mangosteens, fresh or dried
▪ Citrus fruit, fresh or dried
▪ Dried apricots, prunes, apples, peaches, pears, papaws
"papayas", tamarinds and other edible fruits, and mixtures of
edible and dried fruits or of edible nuts
Fruits & Nuts (1/2)
31

▪ Pakistan produces about 650,000 tons of
dates per year.
▪ Fresh or dried dates is the top most
exported product in this category.
Pakistan's exports represent 7.7% of
world exports for this product, its ranking
in world exports is 5.
▪ Sindh province alone produces more
than 50% of the total dates produced in
Pakistan
▪ Pakistan imposed a ban on domestic
consumption betel nuts in 2018
considering its harmful effects on the
health of consumers
Fruits & Nuts (2/2)
© 2019 Dragon Sourcing. All rights reserved. 32
Major Dates Production Zones in Pakistan
Source: salaamgateway.com, pakobserver.net
Sindh Province

0.06
0.13
0.03
0.01
0.03
0.05
0.09
0.02 0.02
0.03
0.05
0.08
0.03 0.02 0.02
0.00
0.10
0.20
Italy China Vietnam Bangladesh India
Top Importers of HS 41 series (Raw hides, Skins
& Leather) from Pakistan in USD billion
2015 2016 2017
0.5
0.4
0.3 0.3
0.0
0.2
0.4
0.6
2014 2015 2016 2017
Export of HS 41 series (Raw hides, Skins &
Leather) from Pakistan in USD billion
4, 17%
3, 10%
2, 8%
2, 8%
0.3, 1%
15, 56%
World Export of HS 41 series (Raw hides, Skins &
Leather) in USD billion in 2017
Italy USA Brazil China Pakistan Others
▪ Leather further prepared after tanning or crusting "incl.
parchment-dressed leather", of bovine "incl. buffalo" or equine
animals, without hair on, whether or not split
parchment-dressed leather", of goats, pigs, reptiles and other
animals, without wool or hair on, and leather of hairless
animals, whether or not split
parchment-dressed leather", of sheep or lambs, without wool
on, whether or not split
Raw hides, Skins & Leather (1/2)
33

▪ Leather and Leather merchandises are
the most significant and the 3rd most
dynamic industrial sector in Pakistan
▪ Leather industry of Pakistan comprises
about 800 small, medium, and large
industrial units and tanneries
▪ According to Pakistan Tanners
Association (PTA), leather industry
contributes 2.6 percent to GDP, 5
percent to country’s total exports
▪ Pakistan is drastically losing its exports
share in the traditional leather markets
mainly due to an increase in cost of
production, failure of domestic industries
to comply with environmental standards
and a decline in supply of leather as a
raw material
▪ It is imperative for Pakistan to resolve the
growth constraints on the leather sector.
Access to technology and sector specific
equipment is important for the expansion
of the leather sector. Moreover
investment in manufacturing and value
addition are required.
Raw hides, Skins & Leather (2/2)
34
Major Leather Processing Zones in Pakistan
Source: pakobserver.net
Karachi
Lahore

TRADE AGREEMENTS
35

Pakistan – Trade Agreements
36
Agreements Free Trade Agreements
Asia
▪ Pakistan – China
▪ Pakistan – Malaysia
▪ Pakistan - Sri Lanka
▪ South Asian Free Trade Agreement (SAFTA)
▪ South Asian Free Trade Agreement (SAFTA) - Accession of Afghanistan
▪ South Asian Preferential Trade Arrangement (SAPTA)
Africa ▪ Mauritius - Pakistan
Other Trade Agreements
Other Agreements
▪ Economic Cooperation Organization (ECO)
▪ Protocol on Trade Negotiations (PTN)
▪ Global System of Trade Preferences among Developing Countries (GSTP)
Source: World Trade Organization
Pakistan has 10 Regional Trade Agreements in effect

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