Pakistan dairy sector expecting $1.5 billion foreign investment: PDA chief

A Pakistani livestock trader feeds his cows at an animal market in Peshawar on August 23, 2017. (AFP)
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Updated 11 December 2019

Pakistan dairy sector expecting $1.5 billion foreign investment: PDA chief

  • Pakistan is world’s third largest milk producer, with 95 percent of it sold by milkmen without processing
  • PDA chairman stressed on better marketing Pakistan’s dairy potential to Saudi Arabia and UAE

KARACHI: Pakistan, the world’s third largest milk producer, is expecting $1.5 billion in mainly foreign direct investment (FDI) in its dairy sector as the country ramps up marketing efforts for pasteurized milk, the chairman of the Pakistan Dairy Association (PDA) said on Saturday.
Pakistan produces more than 59 billion liters of milk annually, according to the Economic Survey of Pakistan, of which 95 percent is sold without processing by milkmen.
“The share of processed milk in the country is only 5 percent at present which shows huge investment potential especially in the processing and supply chain. In the last five years, the industry has attracted $1 billion investment. With even 1% growth, we are looking at at least $1.5 billion FDI that we can bring into Pakistan,” Sulaiman Sadiq Monnoo told Arab News.
“Due to a lack of cold supply chain in the country every year, 11 to 12 billion liters of milk goes wasted that can be preserved with supply chain management,” Monnoo said. He is also CEO of DairyLand, one of the country’s largest dairy farms located in Sindh that produces and markets pasteurized and ultra high temperature (UHT) treated milk.
At present, Monnoo said, two Turkish companies were in the process of bringing operations to Pakistan.
“A Turkish company is coming to Pakistan while another has signed a memorandum of understanding with a Punjab based dairy farm,” he said.
SÜTAS, the Turkish dairy giant signed an agreement with Pakistani multinational conglomerate, Nishat Group, to start their dairy business in Pakistan in October 2018. Nishat Dairy is expected to start production from next year.
The PDA chief also stressed on better marketing Pakistan’s dairy sector potential to Gulf countries.
“Gulf countries such as Saudi Arabia, UAE and Qatar are concerned about their food security and it depends on (Pakistan’s) government how it... offers them opportunity to invest in Pakistan,” Monnoo said.
He added that presently, the dairy market was in stress due to the government’s removal of zero rated tax on the country’s dairy sector, people’s declining purchasing power amid inflation, and due to a negative perception in general about processed milk.
“The price difference has increased between regulated and unregulated milk and people feel the pinch of it,” Monnoo said.
In April this year, Chinese dairy giant, Inner Mongolia Yili Industrial Group suddenly withdrew its intention of acquiring up to 51 percent shares in the army-owned Pakistani food company, Fauji Foods. No reason was formally cited, but the management of Fauji Foods said in a notification to the Pakistan Stock Exchange that the acquirer and sellers had been unable to reach an agreement on the proposed sale and transfer of shares.
The PDA chief however, said he believed the Chinese dairy giant withdrew due to Pakistan’s current market situation.
Still, milk processors hope that an ongoing focus on the marketing of pasteurized milk will create more opportunities and shares for processed milk, and revenue for the government.
“Legislations for pasteurizing milk are being stressed while food authorities in Punjab and Sindh are active against adulterated milk sellers. In the coming days, selling loose milk will be difficult,” Monnoo said.
But small dairy farmers fear the extra legislation could wipe them out as authorities plan on implementing minimum pasteurization laws in eastern Punjab province as early as next year.
“This act will destroy the business of thousands of small farmers especially those who own as low as only two buffalos and feed their families,” Shakir Umar Gujjar, President of Dairy and Cattle Farmers Association told Arab News.
“There is a difference between adulterated milk and organic milk,” he said.


More snowfall raises safety fears in Pakistan's southwest

Updated 20 January 2020

More snowfall raises safety fears in Pakistan's southwest

  • Pakistan’s frost-ravaged southwest braces for more snowfall
  • Death toll due to recent extreme weather reached 106

KARACHI: The Met Office on Monday said that more snow is expected in parts of cold-ravaged southwestern and northern Pakistan over the next 48 hours, where life has already been paralyzed by torrential rains and snowfall last week.
The countrywide death toll from avalanches, landslides and other extreme weather-related incidents during the recent cold spell has risen to 106.
New storms are expected in some of the country’s most isolated places in northwestern Balochistan and Gilgit-Baltistan, according to the meteorological office.
The news made residents fear for their lives and safety.
“A new snowstorm will create new difficulties for us who live here,” said Hashim Khan, a resident of Balochistan’s Muslim Bagh area, which was badly affected by the recent record snowfall. He told Arab News over the phone that road access to remote villages was still cut off and communities remained stranded.
Authorities, however, say that this time they are prepared to address all dangers.
“Snowfall is expected, but it will not be as heavy as it was last week. We are ready to tackle the situation,” Muhammad Younus, an official of the provincial disaster management authority (PDMA) told Arab News.
According to NDMA data, out of the 106 people killed by the recent weather-related incidents, 79 died in Azad Kashmir, 20 in Balochistan, five in Khyber Pakhtunkhwa and two in Gilgit-Baltistan. 
At least 103 people have been injured, while nearly 1,300 houses were damaged, mostly in Balochistan. 
Prime Minister Imran Khan has announced relief packages for the families of victims, National Disaster Management Authority (NDMA) spokesman Saqib Mumtaz said on Monday.
“Chairman NDMA Lt. General Muhammad Afzal visited the rains and snowfall affected areas of Balochistan where Director General Provincial Disaster Management Authority Imran Zarkon briefed him on the losses and damages caused by (the) recent spell of rains and snowfall in the Province,” he told Arab News.
According to the PM House statement, Rs500,000 “will be extended to the families of every deceased person,” while Rs50,000 will be paid to those who are injured. Financial assistance of Rs100,000 “will be provided for the families with houses fully damaged or collapsed,” and between Rs25,000 and Rs50,000 will be given to those whose houses were partially damaged.
PDMA Balochistan said it had faced challenges in restoring the province's land transportation network, as heavy machinery for road clearance was insufficient. The NDMA chairman said the equipment will be supplied, funded from the National Disaster Management Fund (NDMF).