(Last updated: 15 Apr 2011)

Business opportunities

Austrade’s business development specialists have prepared a range of market profiles that offer potential to assist in your exporting investigations. Austrade’s in-market teams have identified opportunities for Australian exporters in various industries (see 'Profiled industries in this market' on the left side of this page).

Business etiquette

Business tips

Please note: Bribery of foreign public officials is a crime. Australian individuals and companies can be prosecuted in Australia for bribing foreign officials when overseas. For more information, go to the Attorney General's Department on foreign bribery.

Tariffs and non-tariff barriers

Tariff

The government of Pakistan is implementing a program of tariff reduction in line with obligations signed on to as part of the World Trade Organisation entry. The general tariff rate will fall to approximately 30 per cent this year. Tariffs can be significant for Australian exporters and we suggest obtaining specific information on your product.

Customs authority contact details:

Federal Board of Revenue
Constitution Avenue
Islamabad
Tel: +92 51 920 1938 or 920 9723
Fax: +92 51 920 5308
Email: chairman@fbr.gov.pk or helpline@fbr.gov.pk

Non-tariff barriers

Imports under loans, credits or bilateral assistance that require a contract to be approved by Economic Affairs divisions, or some other agency of the Government of Pakistan, require the letter of credit to be established within 60 days of registration of contract with a bank designated by the State Bank of Pakistan.

Items on the negative list are banned items (Appendix - 'A'). Some of the main items on the list are:

• items that may be repugnant to the injunctions of Islam
• dyes based on benzidine or containing it
• hazardous wastes, as defined and classified in the Basle Convention
• alcoholic beverages and spirits, including brewing and distilling dregs and waste and wine lees and argol
• factory rejects and goods of job lot, stock lot or substandard quality job lot and stock lot of items where the customs duty is zero per cent
• fireworks, fur skins, waste and scrap of polyethylene and polypropylene plastics, retreaded tyres, used pneumatic tyres
• imports from India have restrictions and only those items can be imported that are specified under the Import Trade and Procedures Order (Appendix B)

Certain restricted items (Appendix - 'D') can be imported only if the stipulated conditions are met. Most of the restricted items would need prior approval or certification from the relevant government agency. Some of the main items include:

• animal semen
• tobacco products
• radioactive material and apparatus
• seeds
• calcium carbide
• asbestos
• food colours
• dyes
• explosives
• insecticides

Wheat is importable only by the public sector.

Product certification, labelling and packaging

Labelling and marking

Packaging should be conspicuously marked with the country of origin and the name of either the manufacturer or the importer. For textiles this is especially important and the yardage, width and length (if in roll) should also be clearly marked.

Dyes and chemicals must be marked with a full description, including quality and code numbers.

Packets of cigars, cheroots, cigarillos and cigarettes of tobacco or of tobacco substitutes should carry the warning: 'Smoking is injurious to health'.

Food colours must carry fair and true labeling about the product.

Labels on packages for edible products should show that they have at least six months or 50 per cent of the shelf life, whichever is the lesser, calculated from the date of filing of Import General Manifest (IGM) and also that they are free of Haraam elements or ingredients. Where these conditions are not printed on the packaging, certificate issued by the manufacturers or principals in respect of these conditions shall be accepted by customs.

Special certificates

Livestock must be accompanied by a sanitary certificate issued by the approved authority in the country of origin. In Australia this is usually the Australian Quarantine and Inspection Service, Commonwealth Department of Agriculture, Fisheries and Forestry-Australia or the relevant state department of agriculture.

All plants and plant products, except fruit and vegetables, require a phytosanitary certificate issued by the approved authority in the country of origin.

Hay or straw used as packing material for plants or seeds must be covered by the phytopathological certificate issued by the approved authority in the country or origin.

Leaf tobacco must be covered by additional certification indicating that it is free from ephestiam elutella or that this pest does not exist in the country of origin.

Used clothing should be accompanied by a certificate of cleanliness signed by a physician with the letters MD following the signature.

A special certificate of alcoholic strength may be required for imports of spirituous beverages.

Supplier's certificate or quality and price are required for certain items.

Methods of quoting and payment

Quotes should be C&F port of delivery in US dollars or Pound Sterling. Payment must be made by irrevocable letter of credit.

Documentary requirements

Fax signatures are not permitted.

Commercial invoice

No prescribed form. Three copies are required.

Invoice must be signed by the manufacturer or shipper and must show names of consignee and vessel carrying the goods, number and description of packages, their serial numbers or other identification, value of goods C&F (freight charges to be shown separately) and country of origin. Except where it is not possible to do so (bulk items or where products are marketed under generic names) the invoice shall give the brand name of the product being imported.

A signed declaration of origin is required.

Bill of lading/airway bill

To Order bills are acceptable. Must show:

• Gross weights and dimensions in metric units
• Name and address of the party to be notified

Packing list

Not obligatory, but facilitates clearance.

Certificate of origin

Although not legally required, the importer or his bank frequently requests this document. If not provided, statement of origin should appear on the invoice.

Public health requirements

The import of livestock, plants and plant material is subject to specific regulations.

New pharmaceutical preparations not previously imported require the prior approval of the Pakistani Director-General of Health. For this approval, the Director-General requires, free of cost, a supply of the preparation to treat about 60 patients. Pharmaceutical industries holding valid licences are permitted to import pharmaceutical raw material subject to the condition that pharmaceutical (allopathic) raw materials are of pharmaceutical grade and have at least 75 per cent of the shelf life calculated from the date of filing of IGM. Pharmaceutical raw materials specifically allowed by the Director-General are exempt from the above requirements. Import of pharmaceutical products is subject to the conditions and limitations laid down in the Drugs Act 1976.

Calcium carbide, whether or not chemically defined, require prior approval of the Department of Explosives. Used or refurbished cylinders (for compressed or liquefied gas) for use in motor vehicles need a safety certificate from the Department of Explosives.

Arms and ammunition not otherwise banned would require authorisation from the Ministry of Commerce.

Ingredients for formulation or manufacturing of pesticides are importable only by industrial user.

Insurance

The importer must arrange insurance through an insurance company registered in Pakistan.

Weights and measures

The metric system.

Taxation

Taxation is a problem area for the government, as Pakistan has a very narrow and small tax base. The Federal Board of Revenue, under the control of the Ministry of Finance is attempting to alter this situation but is having limited success.

The tax rate for private limited, foreign, and unquoted companies for assessment year 2002-03 is 45 per cent. There is also a goods and services tax set at 16 per cent. Provincial government also levy their own taxes.

General tax information:

• Customs duties are up to 25 per cent (four rates 25, 20, 10 and 5 percent) with the exception of vehicles where the duty can be as high as 200 per cent.
• Specific duties are generally assessed on the net weight of goods.
• Sales tax of 16 per cent is levied on most goods.
• Pulses, chick peas are duty free. Soya beans (1201.000) rape or colza (1205.1000 & 1205.9000), sunflower (1206.0000) and safflower seeds (1207.6000) whether or not broken have a custom duty of 10 per cent.
• The duty on raw materials is 10 per cent, for semi-processed 15- 25 per cent and for finished goods that are also manufactured locally the duty is 35 per cent.
• Excise is levied on a wide range of goods.

Exemptions are available industry and area wise.