Monkey business? 2,500 t Indian peanuts stuck in Karachi

CALL it the side effects of frosty political ties on trade. As many as 130 containers carrying almost 2,500 tonnes of peanuts supplied by four Indian companies have been stuck at the Karachi port for around eight months now, without any buyer. The two Pakistanbased firms that were supposed to take delivery didn’t show up. And oddly, the Karachi customs officials were stubborn enough to not allow the Indian exporters to even take the supply back home, let alone sell it to a third party, according to the exporting companies.

Compounding the exporters’ problems, the shipping company is now seeking higher charges for the detention of their containers for such a long period.

Sanjiv M Sawla, chairman of one of the exporting firms, M Lakhamsi & Co, told FE that the deal was contracted by Pure Agri Trade, a company registered in Malaysia, for delivery to two Pakistan-based firms: Unity Commodities and HY International. It later emerged that the Malaysian and Pakistani companies were owned by the same person, he added. The other Indian exporters apart from M Lakhamsi are Divya Corporation, RK Industries and Patel Ravji Mavji.

Divya Corporation and RK Industries are learnt to have approached the Karachi High Court for relief from what trade analysts say is a classic example of non-tariff barriers that Indian exporters often face in Pakistan. However, the exporters fear that even if the verdict comes in their favour, the peanuts, being a perishable farm commodity, might be unfit for human consumption now, lying as they are in Karachi for a long time.

Another industry source said the shipment of peanuts was meant for “onward sale” to China by the Pakistani firms. “We learnt that since that deal collapsed, these Pakistani firms also avoided taking the deliveries,” he said.

Tejas Badani of Divya Corporation said his fir m, which hired 30 containers to supply the commodity, was being asked by the shipping company to cough up Rs 2 crore more for the delay in the release of the containers.

According to one of the Indian companies, the Pakistani customs authorities asked them to pay duties on the supplies. But the exporters rejected the proposition, arguing that when deliveries hadn't taken place, they didn't have any tax obligation.

Senior Indian government officials confirmed that they had received such a complaint from the exporters. One of the exporters said, upon informed, the Indian High Commission in Islamabad had sought information from the customs authorities to help sort out the issue, but they didn't seem to be very cooperative initially.

The Indian High Commission there is learnt to have asked at least one of the exporters to file an affidavit with the customs department there, so that the matter can be resolved at the earliest.

India's farm exports to Pakistan touched $993.80 million in the last fiscal, up from $648.73 million a year before, according to official data. However, over 60% of the export revenue came from supplies of cotton to Pakistan in the last fiscal.

Pakistan imports cotton from India to keep its textile mills going.

Relations between the two countries have been on a roller-coaster ride and particularly frosty since the attacks on the Pathankot airbase in January by militants traced to Pakistan.

The talks between the Indian and Pakistani foreign secretaries in April also failed to make much of a headway on improving relations.

Pakistan, along with China, have been strongly opposing India's bid to become an member of the Nuclear Suppliers Group.

Illustration: SHYAM