Karachi's Traders Demand to Rationalise Duty Structure on PEW Import

The Developers and Pre-Engineered Warehouses (PEW) importers asked the government to rationalise the duty structure on the import of warehouses in order to support development of cheaper ones.

There is a dire need of Purpose Built Warehouses (PBWH) in the country in order to provide cheaper and secure space for exporters and importers, they said on May 26, 2011.

Coastals Chief Executive Officer Ateequr Rehman Anwer said present duty structure on warehouses import is including 25 percent customs duty, 16 percent sales tax and 6.0 percent income tax on the importers.

He said the stakeholders have already assisted developing several PBWH on around 2.7 million square feet within four years at Port Qasim, Mauripur, Korangi Creek, Korangi Industrial Area and on Hawkes Bay Road. He said due to higher cost of imported warehouses, building material and depression in economy, the development pace remained slow but the local investors were eager to invest in PBWH.

He said non-resident Pakistanis have showed a great interest and made investments in the projects of building PBWH in the country.

He said many projects of PBWH are in the pipeline and Pre-Engineered and Reinforced Concrete Construction (RCC) Barrel Shell Roof Warehouses are attracting investors as well as gaining attention of the country's exporters and importers.

He said due to shortage of warehouses, the converters are converting sick mills into warehouses.

He said Coastals has local RCC and imported PEW available on rent and is fulfilling demand of rented spaces on short and long-term basis to the exporters and importers in the country. He said Coastals has one window support facility for the potential investors and requisite on consultancy and rental services for the prospective investors.

He said international and local logistic support services providers have had taken great interest and were occupying hundreds of square feet space, hence providing their 3PL (third party logistic services) where the companies have had outsourced their products to them for warehousing and distribution.

"We need urgently more and more warehouses whether they are supply chain warehouses or cool chain warehouses in the country," he added.

He said special warehouses for banks and insurance companies were in the pipeline, where they keep their record in scan/films etc instead of keeping them in cartons trunks and gunny bags. He said there was tremendous development of warehouses in the Middle East and Far East countries, besides they have warehousing cities and Small and Medium Enterprises sheds.

Public-private partnership (PPP) on warehousing in the country is important as it provides speedy approach to facilitate Supply Chain Solution (SCS).

Providing land by government all along trade corridors and PBWH constructed by private partners would facilitate the stakeholders.

Later on, the land will be transferred to private partners after certain amount of time at terms mutually agreed upon.

Instead on national/international, local/government investments on SCS, which covers all segments of Logistic Support Services mainly the development of warehouses. This is the only investment, which has such a quick return.

Outlining the warehouse development plans and for the speedy growth and development of warehousing, he asked the government should stop crazy duties imposed on the import of Pre-Engineered Building (PEB).

He demanded of the government to relax and reduce the duties structure in order to meet the tremendous requirement and demand of PEB.