Muneeb ur Rehman

Despite significant prospects and abundant resources, the full potential of Pakistan's food sector remains largely untapped. So, by enhancing processing capabilities and focusing on value addition, Pakistan has a considerable opportunity to boost the exports of its food products. Talking to WealthPK, Waheed Ahmed, Vice-President of All Pakistan Fruit & Vegetable Exporters Importers and Merchants Association, said that following the textile industry, the food and beverage processing sector is the second largest industry in Pakistan. "It contributes 27% of the value-added production and 16% of employment in the manufacturing sector." "The food sector faces challenges in processing and value addition," he pointed out. "These challenges stem from the absence of processing facilities, a shortage of skilled workforce and a lack of innovative technology. About 30% of fruits and vegetables go to waste due to negligence and the absence of processing facilities, presenting a significant hurdle to exports of food products."

Source: Trade Development Authority Pakistan (TDAP)

As mentioned by the Trade Development Authority Pakistan (TDAP), the market for food products witnessed a compound annual growth rate of approximately 6% over the past five years. During this period, the potato chips market experienced notable growth of 14.2%, the biscuits market 9.1% and confectionery products 9.4%. Waheed Ahmed underscored the importance of foreign direct investment for promotion of food exports. "With a significant inflow of FDI into the food sector, the country will get modern technology, learn best practices and witness improvements in labour skills." Over the period from 2013 to 2023, the processed food and beverages sector in Pakistan garnered a combined total of $1.8 billion in FDI. The leading investors in this sector were the United Kingdom, the Netherlands and the United States, collectively contributing to around 80% of the overall FDI inflows in the processed food and beverages industry. Waheed Ahmed pointed out that the Phase-II of the China-Pakistan Economic Corridor had put a great emphasis on poverty alleviation and agriculture. "The entry of dairy and meat products into the Chinese market marks a substantial step forward in fostering economic development and generating additional employment opportunities in Pakistan." In a nutshell, through the improvement of processing capabilities and a dedicated emphasis on value addition, there exists a significant potential to enhance the export of food products.

Credit: INP-WealthPk