Their loss, our (potential) gain

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India’s falling red meat exports are creating a space for Pakistan in the Middle Eastern market. A Human Rights Watch report reveals that the Indian cow protection movement is hurting its beef exports and related businesses.

During the last year or so, India’s meat exports have dropped by about 30 per cent, especially to the Gulf countries. The vacuum created, coupled with local factors, is attracting Pakistani exporters and investors towards this sector.

The country exported at least 125,505 tonnes of beef and veal meat to the Gulf States during the first 10 months of 2018-19, according to data made available by the Trade Development Authority of Pakistan (TDAP).

India’s meat exports have dropped by about 30pc creating a vacuum that Pakistan can exploit

The United Arab Emirates was the largest buyer with a tally of 67,275 tonnes.

Cow vigilantism, foot & mouth disease and other factors are decreasing India’s share in the global beef trade, brightening Pakistan’s chances to fill the space and attract new investments in the cattle trade, says Dr Muhammad Hayat Jaspal, chairman of the Department of Meat Science and Technology of the University of Veterinary and Animal Sciences, Lahore.

“There are daily queries from potential financiers seeking investment opportunities in cattle and dairy farming, promising a boost for the rural economy,” he says, insisting that Pakistan is capturing India’s share.

The rising cost of production in the poultry farming sector, whose feed mostly comprises of imported ingredients, is also helping divert investment towards cattle farming which is a comparatively more secure business, he adds.

Cattle farming has been increasing for the last couple of years, says director of Komal Food Arif Mustafa. Komal food is a firm that deals in the meat export business.

Dairy and cattle farming has doubled since the introduction of potatoes as a low-cost cattle food, he says.

Nonetheless, individual efforts require official support to enhance foreign exchange earnings and improve the lot of the rural population, the traditional cattle farmers. Mr Mustafa urges the government to convince the State Bank authorities to reduce the red meat export benchmark from $4 to $3, at par with the export price set by India, to make local exports more competitive in the international markets.

While there has always been space in the Gulf region for Pakistan’s meat exports, the lack of certain facilities, poor policies and our own inabilities have prevented the country from realising its full potential, he said.

Mr Mustafa called for the removal of hurdles in obtaining a quarantine certificate, particularly when meeting some urgent foreign orders. “The quarantine department officials are unavailable on off-days and after office hours, delaying the export consignments by at least 24 hours.”

Naseeb Ahmad Saifi, another meat exporter, points out that the overhead charges in the form of higher tax rates, enhanced transportation costs and the manifold increase in the requirements of attested documents by local chambers are other hurdles blocking the development of the sector and making it uncompetitive in the world markets.

He claims that it is possible to increase national halal food exports to several billion rupees within a couple of years, provided that the government makes it a zero-rated sector. This would allow cattle farms to be established at a minimal cost in the shortest possible time.

“The government must not focus just on one sector. Rather, it should encourage whosoever and whatever products the country can export through legal means instead of promoting a sector at the cost of others.”

Dr Jaspal suggests that till the authorities provide support to the sector, the stakeholders may reduce costs while increasing profit margins within six months by adopting techniques to fatten calves.

“Presently, 14-16-month-old calves weigh an average of 125 kilograms and are being slaughtered for export purposes.

“By adopting fattening food, their average weight can be increased to 240kgs within six months and thus exports can be doubled (while the number of cattle remains the same) at a marginal extra cost.

Published in ThePublic, The Business and Finance Weekly, September 30th, 2019

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