LAHORE: The dumping of coated bleached board and related products from China are not only harming Pakistan’s paper and board manufacturing industry but also causing significant losses to the federal government in terms of foreign reserves and revenue due to circumvention of anti-dumping duties, stakeholders say.

The local industry has informed the National Tariff Commission (NTC) about the circumvention, prompting an investigation into the matter, Dawn has learned.

A local industry source claimed they don’t need to import even a single kilogram of coated bleached board, but surprisingly, the government remains silent despite knowing that it’s harming the local industry and causing losses to the government’s foreign reserves and revenue. He demanded that the government end the circumvention practices of exporters/importers liable under the WTO Antidumping Agreement and Anti-dumping Duties Act 2015 of Pakistan.

The paper and board industry serves as the backbone of the FMCG sector, fulfilling packaging needs efficiently and economically through local infrastructure. During Covid-19, packaging goods (paper/board) were declared essential, and despite lockdown restrictions, the industry ensured continuity of supply to life-saving sectors like pharmaceuticals, food, and hygiene.

The total investment in the industry is around Rs400 billion, with a capacity of over 2 million tons, sufficient to meet local demand. The source says unfair competition from imported products originating from East Asian countries has put the industry under immense economic pressure due to under invoicing, dumping, and misdeclaration.

The last quarter of 2023 and 2024 proved to be the worst, with capacity overhang in China and Indonesia forcing local mills to sell products at prices even lower than raw material cost. One leading P&B industry in Pakistan suffered a net loss of nearly Rs1 billion recently.

The NTC implemented anti-dumping duties on paper, duplex board, and bleached board after extensive due diligence, but interested parties exploited loopholes, causing a loss of Rs14 billion to the national exchequer since 2018. This loss is in addition to capacity loss and precious foreign exchange.

The underutilisation of the domestic industry, which has full capability and capacity to meet local needs, is causing severe damage to manufacturing concerns and potential loss of millions of people involved in its value chain, including waste paper collection and other domestic industries dependent on it like chemical, technical services, and utility suppliers.

The stakeholders welcomed NTC’s proceedings for “anti-circumvention” investigations, and urged the government to help save the country’s paper board market, which is in the developing and growing stage and requires policy support.

Published in Dawn, June 3rd, 2024