The duty-free import of a product from Sri Lanka threatens first can manufacturing plant of Pakistan. The economic sustainability of Pakistan’s first aluminum drink can manufacturing plant was tested. The reason for its testing in the first month of its launch was because the manufacturing company expects tough competition of a similar product imported from Sri Lanka under the Free Trade Agreement
In order to tackle the competition of low priced goods from Sri Lanka, the Pakistani corporation has reduced custom duty on import of raw material by three times.
The local industries of Pakistan have suffered due to Pakistan’s free trade contracts with three Asian countries China, Malaysia and Sri Lanka. This make us question Ministry of Commerce’s decisions where they have given preference to other nations over domestic market.
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The metal can manufacturing plant is established in Faisalabad by Ashmore Group of the United. Money invested on this plant is $70 million. The plant has ability to produce 700 million cans per year but Pakistan’s Liberty Group just has a minority stake in it. The amount of cans that this plant can produce is double the need of Pakistan’s market.
The plant has begun to operate this month. Now it will manufacture beverage cans for Pakistan and Afghanistan industry. Pakistan packaging requirements are met through imports. Now the company has come up with Pakistan’s own packaging system and has reduced import duty on raw material to reduce the price of production.
Abdullah Yousuf, Co-chairman of Pakistan Aluminium Beverages Company said that the company is contend with Pakistan’s government decision to rise custom duty on finished import goods to 20% from 11% in the recent budget. Though, not reducing custom duty on raw material to 3% from 11% can be an issue in the project as per Yousuf. As raw material make up more than half the production cost, not decreasing custom duty on them is viability in the project.
From Sri Lankan point of view the high commissioner has raised voice as Pakistani government has raised custom duty on imported products. The high commissioner of Sri Lanka would soon meet Finance Minister to discuss this matter.
We feel that if our own country is coming up with products and goods then they should be given preference over imported products. In order to boost our domestic industry we all need to support Pakistani merchandise.