Required Report - Public distribution

**Date:** 8/7/2007

**GAIN Report Number:** PK7017

PK7017

**Pakistan**

**FAIRS Country Report**

**Annual 2007**

**Approved by:**

Margaret E. Thursland, Agricultural Counselor![](media/image1.wmf), U.S.
Embassy, Islamabad

**Prepared by:**

Asmat Raza, Agricultural Specialist, U.S. Embassy, Islamabad

**Report Highlights:**

Pakistan is a member of the World Trade Organization and is also party
to two regional trade agreements: the Economic Cooperation Organization
(ECO), and the South Asian Association for Regional Cooperation (SAARC).
Pakistan have Free Trade Agreements (FTA) with China and Sri Lanka. The
Pakistan Pure Food Laws (PFL) of 1963 are basis of the existing trade
related food quality and safety legislative framework in the country.
They cover 104 food items falling into nine broad categories. These
regulations address purity issues in raw food and deal with subjects
associated with additives, food preservatives, food and synthetic
colors, antioxidants, and heavy metals. Pakistan adheres to the
Harmonized Coding System for classification of imported goods. Food
Labeling and packaging requirements are enforced. Pakistan is
progressing in Agricultural Biotechnology: bio safety guidelines and
rules were enacted in April 2005 and a system to monitor and evaluate
in-coming proposals has been established. There are no
biotechnology-related trade barriers between U.S. and Pakistan.

Includes PSD Changes: No

Includes Trade Matrix: No

Annual Report

Islamabad \[PK1\]

\[PK\]

Table of Contents

[**Introduction 3**](#introduction)

[Section I: Food Laws 4](#section-i-food-laws)

[Section II: Labeling Requirements 5](#section-ii-labeling-requirements)

[Section III: Packaging and Container Requirements
6](#section-iii-packaging-and-container-requirements)

[Section IV: Food Additive Regulations
7](#section-iv-food-additive-regulations)

[Section V: Pesticide and Other Contaminants
7](#section-v-pesticide-and-other-contaminants)

# Section VI: Other Regulations and Requirements..................................................... 7 

[Section VII: Other Specific Standards
8](#section-vii-other-specific-standards)

[Section VIII: Copyright and/or Trademark Laws
9](#section-viii-copyright-andor-trademark-laws)

[Section IX: Import Procedures 9](#section-ix-import-procedures)

[Section X: Post Contact 9](#__RefHeading___Toc174252548)

[Appendix I: Main Regulatory Agencies
10](#appendix-i-government-regulatory-agencies-contacts)

[Appendix II: List of Food Colors and Food Color Lakes
11](#appendix-ii-list-of-food-colors-and-food-color-lakes)

# Introduction

Pakistan, with a population of 160 million, has an average per capita
income of \$925. During FY 2006/07 Pakistan's GDP increased by 7
percent. The inflation rate is at 7.5 percent and the economy is
expected to grow due to continued business activity coupled with a
slight drop in the annual population growth rate to 1.8 per cent.
Pakistan's economy remains heavily dependent on external factors:
current growth may be hampered by re-occurrence of drought as well as
the recent rise in international oil prices. The agriculture sector
contributes 21 percent to GDP, employs 44 percent of the labor force and
generates a large share of the nation\'s foreign exchange earnings.

A relatively sustained economic recovery over the past several years has
increased levels of imports, and despite Pakistan's
less-than-transparent trade regime it remains an importer of U.S.
cotton, vegetable oil, and an expanding market for U.S. food products.

Pakistan have Free Trade Agreements (FTA) with China and Sri Lanka.
Singapore has exchanged a draft FTA with an investment protection
clause. Negotiations are also underway to conclude an FTA with
Bangladesh.

# 

Pakistan is a member of the World Trade Organization and is also party
to two agreements for regional trade liberalization: the Economic
Cooperation Organization (ECO), comprising of Turkey, Iran, Afghanistan,
Azerbaijan, Kazakhstan, Kyrgyz, Tajikistan and Turkmenistan; and the
South Asian Association for Regional Cooperation (SAARC), with India,
Bangladesh, Sri Lanka, Bhutan, Nepal and the Maldives.

The South Asian Free Trade Area (SAFTA) has been in operation since
January 1, 2006 and the SAFTA regime will be fully in force by 2016.
India, Pakistan and Sri Lanka will lower their custom tariffs to 20% by
January 1, 2008. The first tariff reduction has been in effect since
1^st^ July 2006 by all member states except Nepal.

A Preferential Tariff Arrangement (PTA) between Pakistan, Iran and
Turkey under the ECO is in place. It provides 10% reduction in tariffs
on a list of specific items. Within its framework, there is an effort to
gradually reduce tariffs and non-tariff barriers as well as expand the
list of commodities receiving preferential treatment. To supplement the
efforts for trade promotion, two important instruments have been made
functional: the ECO Transit Trade Agreement and the Agreement on
Simplification of Visa Procedures for Businessmen of ECO countries.

The Early Harvest Program (EHP) between Pakistan and Malaysia has been
operational since January 1, 2006 and shall expire upon initiation of
Free Trade Agreement (FTA) during the current year. Pakistan\'s EHP
offer to Malaysia covers 125 tariff lines including mechanical equipment
and appliances, plastic products, chemical products and rubber products.
Malaysia\'s offer to Pakistan covers 114 tariff lines including textiles
and clothing, agricultural products, and jewellery. Interim Rules of
Origin (ROO) will be applied to the products covered under the EHP. The
EHP ROO will be replaced by a new set of rules under the FTA.

India and Pakistan are working slowly to increase bilateral trade though
achieving change is contingent upon geo-political developments. Pakistan
has allowed duty free import of live

animals, meat, garlic, onion, potatoes and tomatoes. India has accorded
MFN status to Pakistan, but reciprocal status, to date, has not been
granted to India. Both countries are working on a fiber-optic link,
which should help to improve bilateral trade.

A Trade and Investment Framework Agreement (TIFA) is in place between
Pakistan and United States since July 2003. Both countries are now
involved in negotiations on a Bilateral Investment Treaty (BIT).

Pakistan has significantly reformed its trade regime in recent years.
Except for strategic commodities, particularly wheat, state involvement
in trading has been greatly reduced. The Government of Pakistan (GOP)
has agreed to eventually phase out the consumption subsidy on wheat.
Rice and cotton exports have been privatized and a number of export
subsidies eliminated.

Tariffs range from 0 to 25 percent and will be reduced further as a part
of the long-term plan to rationalize the duty structure. GOP levies
surcharges on certain items (e.g., vegetable oils) to protect domestic
industry. Revenue collection remains problematic due to a narrow tax
base and a culture of tax evasion. As a result, GOP finds it effective
to collect sales and income taxes on imports upon arrival.

Pakistan is progressing in the field of Agricultural Biotechnology.
Bio-Safety guidelines and rules were enacted in April 2005 and a system
to monitor and evaluate the incoming proposals has been established. GM
soybeans and soybean oil are currently imported by Pakistan. GM corn
seed and cottonseed imports may find a market in the light of a recently
established Bio-Safety Protocol. There are no biotechnology related
trade barriers between United States and Pakistan. Import of GE products
in Pakistan is allowed, though the country\'s 1961 Food Act requires
exporters to label their products with a list of ingredients.

# Section I: Food Laws

The Pakistan Pure Food Laws (PFL) of 1963 are the basis of the existing
trade-related food quality and safety legislative framework in the
country. They cover 104 food items falling under nine broad categories:
milk and milk products, edible oils and fat products, beverages, food
grains and cereals, starchy food, spices and condiments, sweetening
agents, fruits and vegetables and miscellaneous food products. These
regulations address purity issues in raw food and deal with additives,
food preservatives, food and synthetic colors, antioxidants, and heavy
metals.

Essentially, the federal government regulates imports and the provincial
governments regulate food standards. Food standards are maintained in
the light of the PFL and are administered by provincial Health
Departments. At the time of import, the federal Customs Department will
check the PFL standards to determine whether an imported item qualifies.
If the item is not defined in the PFL standards, the Pakistan Standard
Institute (PSI) will be consulted. PSI standards are revised every five
years. To ensure that an imported product meets provincial health
requirements, the exporter and/or his agent should contact provincial
Health Departments to verify that the product meets the requirements of
the Pure Food Laws and the Pakistan Standard Institute.

In general, Pakistan's federal food import regulations are based on the
premise that if a product is sold in the country of origin, Pakistani
standards are met as well. The federal government generally applies
Codex standards and guidelines in its regulation of imported food
products. U.S. Food and Drug Administration standards also are used for
certain products. A list of permissible food colors is updated every
year. For animal products, \"Halal\" certification (slaughtered in
accordance with Islamic law) is required.

The Customs Department and Plant Protection and Quarantine (PPQ) are the
two main agencies involved in regulating food imports. The Customs
Department's primary function is to ensure that imported foods meet
Pakistan's labeling and shelf-life requirements, that they are not on
the list of banned items and are assessed the appropriate import tariff.
PPQ's function is to ensure that bulk commodities and live animal
shipments meet phytosanitary requirements.

The federal government's primary concern regarding imported food is
shelf life. Federal import regulations require that imported food
products have at least 50 percent of original shelf life remaining at
time of importation. To ensure shelf life requirements are met, correct
labeling is of critical importance. Each retail pack must have the
production and expiration dates printed on the label. In addition to
shelf life and labeling, certain products are banned for religious
reasons. The importation of food products containing pork or pork
products is prohibited. Meat and dairy products may be imported if
certified to be \"Halal.\" Commercial import of alcoholic beverages or
products containing alcohol is also prohibited.

Pakistan controls certain imports through a \"negative list.\" The
negative list is comprised of (a) items banned for reasons of religion,
security or luxury consumption; (b) capital and consumer goods banned to
protect a domestic industry; and (c) intermediate goods used to produce
protected goods. Pakistan also maintains a \"restricted list\" of items
that may be imported only by certain parties (i.e., the government or
other specified users) or under certain arrangements (such as imports
against credit).

Other than above, there are no federal restrictions on the importation
of consumer foods. U.S. exporters have had problems with requirements
due to the use of bar-code labels, which do not have
[printed]{.underline} dates of manufacture and expiration. As a result,
U.S. suppliers using bar-coded labels alone will incur the extra cost of
printing new labels or of affixing stickers with the printed production
and expiration dates on each retail pack.

Since Pakistani consumers have confidence in the quality of foods
imported in the manufacturers packaging, most foods are imported in
consumer-ready packaging. Refined vegetable oil is the one exception and
is generally imported in bulk and re-packed locally.

# Section II: Labeling Requirements

**General** **Requirements**

1\. Imported food products, including ingredients, must have at least 50
percent of their original shelf life remaining at the time of
importation - calculated from the date of filing the \"Import General
Manifest\" (IGM) in accordance with the Customs Act of 1969.

2\. Packages or containers must also indicate:

a\. The date of manufacture and date of expiration,

b\. That the contents are free from pork and pork products,

c\. That the contents are fit for human consumption and that any animal
product was obtained from an animal slaughtered according to 'Halal'
requirements,

d.  That imports of edible oils be on the basis of landed weight and
    landed quality, and

e\. That packing may not contain any word or inscription of a religious
connotation or any obscene picture that may offend the religious feeling
of any sect, class or group in Pakistan.

3\. The production and expiration dates must be printed in English,
using either words and/or numbers.

4\. Standard U.S. bar-code labels alone are generally not acceptable as
they lack [printed]{.underline} production and expiration dates, as
required by law.

5\. Stickers, which contain the required printed dates of manufacture
and expiration, should be affixed to the standard U.S. labels prior to
shipment.

6\. Products for institutional sale are governed by the same regulations
as products for direct retail sale. However, certain institutions may
request additional information on the label to identify it as their
product.

7\. Samples are governed by the same regulations as products for direct
retail sale.

8\. The coded \"best before use date\" is not considered to be an
acceptable expiration date. In the past, several cargoes containing
items without printed production and/or expiration dates were held by
Customs until stickers, with production and expiration dates certified
by the Pakistani High Commission in the United States, could be affixed
to each individual item.

9\. Pakistan does not have any special or additional requirements based
on the country of origin for any food product. In the event there is a
worldwide alert for a product from a particular origin, Pakistan will
notify the appropriate country and trade organizations of any changes in
its import requirements.

10\. Authorities are very strict regarding label requirements and do not
grant exceptions. Instead, they are authorized to reject or to destroy
any cargo with improper labels.

**Requirements Specific to Nutritional Labeling**

Pakistan does not require nutritional content to be listed on product
labels but generally accepts U.S. Food and Drug Administration (FDA)
regulations as guidelines. The Pakistan Standard Institute regularly
updates its guidelines, based on Codex and FDA revisions.

1\. Nutritional labels are not required but can be included at the
option of the supplier.

2\. The standard U.S. nutritional fact panel is acceptable, if it
conforms to FDA regulations.

3\. There are no regulatory restrictions on the importation of products
with nutrient or nutritional claims. Pakistani authorities consider
claims largely as promotional tools and thus far, do not require them to
be based on scientific evidence.

4\. There are no regulatory restrictions on the importation of products
with implied claims. Here again, authorities consider these claims to be
promotional tools and do not require them to be verified by scientific
evidence.

5\. Authorities generally have no objection to the importation of
products with specific health claims. However, if a product claims to be
a source of vitamins or minerals, it must be registered with the
Ministry of Health prior to arrival, jointly in the name of importer and
manufacturer.

# Section III: Packaging and Container Requirements

Pakistan generally follows Codex rules for packaging requirements. If
packaging material is acceptable in the exporting country, it is
acceptable in Pakistan. Pakistan does not have any

packaging requirements related to environmental concerns, such as waste
disposal or recycling.

The following information must be placed in a durable and legible manner
on all packages in the consignment or container:

\-- The name of the product,

\-- The name and address of the manufacturer;

\-- The net contents,

\-- The date of manufacture and date of expiration,

\-- The percentage of dye contents, and

\-- The normal storage stability.

# Section IV: Food Additive Regulations

Pakistan generally follows Codex rules for food additives and
preservatives. The Ministry of Commerce updates its list of importable
food additives based on guidance received from Codex. Pakistan also
follows Codex standards regarding vitamins in food products.

The Ministry of Commerce regulates the importation of food coloring.
These regulations are reviewed and updated annually. The importation of
food coloring or foods containing artificial colors is subject to the
following conditions:

a)  The importer must obtain a certificate from the concerned agency of
    the government of the exporting country. The certificate shall
    accompany each consignment and shall state that the food
    additives/colors are in use in the country of origin at the time of
    shipment or are registered for use in that country.

b)  The exporter's invoice must show the percentage of dye contents in
    the product.

U.S. exporters may obtain the list of importable additives from the
Ministry of Commerce through the FAS/Islamabad office. These lists are
in English and are updated annually. Annex II contains a list of
importable food colors.

# Section V: Pesticide and Other Contaminants

Pakistan generally follows Codex rules and guidelines on maximum
residual limits (MRLs) of pesticides and other contaminations in
foodstuff. Custom officials enforce these rules according to Codex
defined limits for imported foods. However, Pakistan does not have a
system to enforce the MRLs of pesticides and other contaminations in
domestically produced foods.

Occasionally, authorities enact special requirements, as occurred
following the dioxin problem in Belgium in 1999, when Pakistan required
a dioxin-free certificate on products originating from Belgium.

###### **Section VI: Other Regulations and Requirements** 

The importer shall ensure that:

1.  Importation is in accordance with regulations and the item(s) are
    not on the negative list.

2.  The terms and conditions of importation are specified in the letter
    of credit.

3.  Imports of plants and animals have the necessary approval of the
    Ministry of Food and Agriculture.

4.  Imports of livestock genetics have the necessary clearance of the
    Livestock Division of the Ministry of Food and Agriculture.

**Registration:** There is no requirement to register most consumer
foods. However, laboratory testing may be required for food products
containing medicines. Bulk vegetable oils are the only products subject
to random testing to ensure fitness for human consumption at time of
arrival.

If registration is required, the importer must file application with the
Ministry of Health. The importer also must attach a letter from the
manufacturer stating that he is the manufacturer's sole agent. This
letter is required because the product will be registered jointly in the
names of the manufacturer and the importer for an initial period of one
year, which is extendable. The importer also must submit: a registration
fee, a sample of the product in the various packaging to be marketed, a
complete product history and other required papers. Registration can
take from 3 months to a year to complete.

**Samples:** Product samples can be shipped via express mail or parcel
post. If a sample meets labeling and other requirements, it will be
released after the applicable tariffs and taxes are paid. Free samples
are assessed duty based on freight costs. Specific requirements for
sample shipments may be obtained from the Ministry of Commerce.

**Certificate of Origin:** The exporter must provide a certificate of
origin for all shipments. For animal products, the exporter also must
certify that the product is \"Halal." Pakistan may require other
specific certificates based on worldwide alerts or other emergency
situations. In such instances, the Government of Pakistan will alert the
appropriate countries and trade organizations of these requirements.
Exporters should verify with their importers that all required
certificates for customs and quarantine clearance have been obtained
prior to shipment.

There is no system to monitor products at wholesale or retail levels.
Under certain circumstances, district administrators, in cooperation
with food inspectors, may inspect outlets and, based on their finding
may ban the sale of a product.

# Section VII: Other Specific Standards

Pakistan generally follows the European standards for weights and
measurements. U.S. weights and measures are acceptable. Other standards
applied by product include:

1.  Codex rules to regulate importation of vitamin-enriched products.

2.  Food products containing a genetically enhanced component (GMO) are
    not restricted.

3.  Fresh or frozen seafood may be imported in consumer packs or in
    bulk, provided the sale of the same product is permitted in the
    country of origin

4.  Live animals must provide a quarantine certificate from the relevant
    authority in the country of origin, which contains all the
    information required for quarantine clearance

5.  Alcoholic beverage may not be imported for commercial sale.
    Importation of alcohol

> for other than commercial sale requires approval of the Ministry of
> Commerce

6.  Organic foods and health foods are not regulated. However, exporters
    may use FDA and Codex rules as a general guideline.

7.  Product samples and free samples must follow the same regulations as
    commercially imported items.

# Section VIII: Copyright and/or Trademark Laws

Pakistan is committed to World Trade Organization (WTO) agreements and
is moving to comply with WTO agreements on intellectual property rights,
trademarks and patent rights. Pakistan has enacted laws and is in the
process of formulating the sub-ordinate legislation to enforce these
laws. Pakistan is also a member of the Universal Copyright and Bern
Conventions.

Pakistan has addressed Intellectual Property Rights by forming an
independent body, the Intellectual Property Organization - Pakistan
(IPOP). This agency has streamlined access to the organization by having
one point of entry. In the past the Ministry of Commerce managed "trade
marks," the Ministry of Education managed "Copyrights" and the Ministry
of Industries was responsible for "patents." A copyright on a registered
design is initially granted for five years extendable for another ten
years. Patents are granted for up to 16 years from the date of
application and may generally be extended for another five years period
and, under some circumstances, for an additional five years. Legal
remedies, such as injunctions, are available in cases of patent
infringement. Trademarks are registered for seven years from the date of
application and the registration may be renewed for an additional
fifteen years.

There is no statute of limitations on trademarks and brand name
registrations. The importer of a food product, in coordination with the
manufacturer, may register the trade mark(s) and brand(s).

# 

# Section IX: Import Procedures

All importers must register with the Export Promotion Bureau and are
required to be registered as an importer under the Registration
(Importers and Exporters) Order of 1993.

a.  Customs officials and Plant Protection and Quarantine officials, to
    ensure they conform to labeling and other import requirements must
    inspect imported products. Imports of live animals or plants require
    necessary certification from the country of origin. After Customs
    and PPQ issue their respective clearance reports, the goods are
    released on payment of import duty.

b.  English is the official language. All agencies will accept documents
    in English and will respond in English. Thus, there is no need to
    translate documents to Urdu or other local languages to expedite
    procedures.

c.  Goods generally can be cleared from Customs in less than a week, if
    all papers are in order.

d.  The system allows for appeal (at multiple levels) in case of a
    dispute.

[]{#__RefHeading___Toc174252548 .anchor} **Section X: Post Contact**

If you have questions or comments regarding this report or need
assistance exporting to Pakistan, please contact the Foreign
Agricultural Service's office in Islamabad at the following:

Mailing Address: Agricultural Attaché

AMEMB-Islamabad

Unit 62200, Box 16

APO AE 09812-2200

Local Address: Agricultural Attaché

U.S. Embassy

Diplomatic Enclave

Ramna 5

Islamabad, Pakistan

Phone: (92-51) 208-2276

FAX: (92-51) 227-8142

E-mail: [agislamabad@usda.gov]{.underline}

For more information on exporting U.S. agricultural products, please
visit the Foreign Agricultural Service's home page at:
[http://www.fas.usda.gov](http://www.fas.usda.gov/)

# Appendix I: Government Regulatory Agencies contacts

Secretary

Ministry of Food and Agriculture

Government of Pakistan

Pak. Secretariat, Block \"B\" Tel \# (92-51) 920-3307

Islamabad, Pakistan Fax \# (92-51) 922-1246

Secretary

Ministry of Commerce

Government of Pakistan

Pak. Secretariat, Block \"A\" Tel \# (92-51) 920-1816

Islamabad, Pakistan Fax \# (92-51) 920-3104

Secretary

Ministry of Industries

Government of Pakistan

Pak. Secretariat, Block \"A\" Tel \# (92-51) 921-1709

Islamabad, Pakistan

Secretary

Ministry of Finance

Government of Pakistan

Pak. Secretariat, Block \"Q\" Tel \# (92-51) 922-4956

Islamabad, Pakistan Fax \# (92-51) 921-8062

Chairman

Central Board of Revenue

CBR House Tel \# (92-51) 920-1938

Islamabad, Pakistan Fax \# (92-51) 920-5308

<chairman@cbr.gov.pk>

Collector of Customs

Pakistan Custom House Tel \# (92-21) 921-4170

Karachi, Pakistan Fax \# (92-21) 921-4134

Chairman

Export Promotion Bureau

Finance and Trade Center Tel \# (92-21) 920-6462

Shara-e- Faisal, Karachi, Pakistan Fax \# (92-21) 920-6461

<chairmanepb@yahoo.com>

Pakistan Standard Institute

Food and Agricultural Division Tel \# (92-21) 920-5997

Karachi, Pakistan Fax \# (92-21) 920-5928

Governor/Director

State Bank of Pakistan

Central Directorate

I.I. Chundrigar Road Tel \# (92-21) 921-244-748

Karachi, Pakistan Fax \# (92-21)

# Appendix II: List of Food Colors and Food Color Lakes

S. NO. Common Color Name

1\. Curcumin

2\. Riboflavin

3\. Riboflavin-S-phosphate

4\. Tartrazine

5\. Quinoline yellow

6\. Sunset yellow FCF and orange yellow S

7\. Cochineal, carminic acid, carmines

8\. Azorubine, carmoisine

9\. Amaranth

10\. Ponceau 4R, cochineal Red A

11\. Erythrosine

12\. Red 2G

13\. Allura Red AC

14\. Patent Blue V

15\. Indigotine, Indigo carmine

16\. Brilliant blue FCF

17\. Clorophylls and Chlorophyllins

18\. Copper complexes of chlorophylls and chlorophyllins

19\. Green S

20\. Plain caramel

21\. Caustic sulphite caramel

22\. Ammonia caramel

23\. Sulphite ammonia caramel

24\. Brilliant Black BN, Black PN

25\. Vegetable carbon

26. Brown FK

27. Brown HT

28\. Mixed carotenes

29\. Beta cartene

30 Annatto, bixin, Norbixin

31\. Paprika extract, capranthin

32\. Lycopene

33\. Beta-apo-8 carotenal (C 30)

34\. Ethyl ester of beta-apo-8-carotenic acid (C 30)

35\. Lutein

36\. Canthaxanthin

37\. Beetrool Red, Betanin

38\. Anthocyanins

39\. Calcium carbonate

40\. Titanium Dioxide

41\. Iron oxide and hydroxide

42\. Aluminium

43\. Silver

44\. Gold

45. Litholrubine BK

Note: The above list is not all conclusive.