Union of Small and Medium Enterprises send SOS to Ministry of Commerce to save Rice Industry

Karachi, May 26, 2015 (PPI-OT): The Union of Small and Medium Enterprises (UNISAME) has appreciated the efforts of the ministry of commerce (MINCOM) in making plans for enhancing exports of Pakistani rice but invited its attention to the negative role of Quality Review Committee (QRC) and said all efforts will be in vain unless the QRC is closed. UNISAME urged the ministry not to procrastinate and not to commit wilful omission and close the QRC and save the rice industry from collapse.

Closure of QRC will be for the betterment of the rice industry in Pakistan and will give a free hand to rice exporters to sell their brands and remove hurdles created by this troublesome committee. The rice units have closed down and rice business is now in the hands of only a few big exporters. The SME rice exporters have been eliminated by the QRC.

President UNISAME Zulfikar Thaver said the MINCOM is trying to find an alternate solution to pre-shipment inspection (PSI) when there is no need for PSI as it is the privilege and prerogative of the buyer and PSI is always by a third party never by the seller or the sellers nominated body. The reply of MINCOM is unsatisfactory and unwise and MINCOM should have nothing to do with PSI as it is between the buyer and the seller.

He reminded the MINCOM of its firm decision in writing to finish the committee and urged the ministry of commerce (MoC) not to commit wilful omission and dissolve the QRC forthwith in view of the no objection received from the law division and consensus of all stakeholders.

Rice exporters are facing very challenging times due to loss in realization proceeds because of exchange rate and are now not in a position to overcome hindrances created by a non commercial organization devoid of commercial sense and expertise. The SME rice exporters are planning to file a complaint with the Ombudsman for wilful omission if the MINCOM does not close it by the end of this fiscal year.

He pointed out that the creation of QRC was a big mistake as it gave rise to conflict of interest. It was based on wrong premises and it gave the opportunity to office bearers of the Rice Exporters Association of Pakistan (REAP) to subdue their competitors. MoC realized this and made amendments and separated the office of QRC and REAP and also removed the mandatory condition of membership of REAP for rice exporters.

The QRC cannot function as a PSI under any law and its formation is based on misapplication and twisting of law to suit the big and influential and it is appreciated that the Moc has realized its futility and made serious efforts to curtail its powers.

He said the QRC has no locus stand as it is neither qualified nor eligible and although just a quality review committee it is posing itself like a pre-shipment inspection (PSI) organization. It was basically formed to protect the basmati label but now that rice is sold by the buyers and the exporters own popular brands and other varieties which are not basmati but more costly and more in demand are flooding the markets and the job of the QRC is futile.

Secondly most of the buyers have their own nominated PSI agency to carry out PSI. QRC never made efforts to get 386 a very popular variety as basmati although in India 386 is considered and approved as basmati but in Pakistan QRC allowed its favourite exporters to export it as basmati but did not recommend it to be approved as basmati for reasons best known to itself. QRC is devoid of any substantial work as a protector of basmati and in fact is creating hurdles in its exports due to lack of knowledge on the subject.

Needless to state that basically the QRC was formed in violation of the principles of PSI and the Pakistan Standard Quality Control Authority (PSQCA) never recognized and enrolled it as a PSI body because it did not comply with the rules and regulations of the PSQCA and international standards.

A PSI body has to be a joint stock company incorporated and with a capital sufficient to pay claims against irresponsible inspections, it needs to be eligible, qualified and must have DNA facilities and laboratory fully equipped with all measuring and quality assessment equipments. It is very important that it has to be independent, transparent and a third party. It cannot be managed by vested interest.

Thaver said that we fail to understand the delay for the closure of the QRC as there is consensus for its closure from all stakeholders and the earlier the MoC says good bye to this organization the better it will be for all.

For more information, contact:
Union of Small and Medium Enterprises (UNISAME)
75/1 3rd Commercial Street,
Phase IV, D.H.A., Karachi, Pakistan
Tel: +92-21-35884225-6
Fax: +92-21-35380642
Cell: +92-300-8245307, +92-321-8245307
Email: unisame@gmail.com