Buying and Selling

flag Pakistan Pakistan: Buying and Selling

In this page: Market Access Procedures | Reaching the Consumers | Distributing a Product | E-commerce | Organizing Goods Transport | Identifying a Supplier

 

Market Access Procedures

International Conventions
Member of World Trade Organisation
Party to the Kyoto Protocol
Party to the Washington Convention on International Trade in Endangered Species of Wild Fauna and Flora
Party to the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal
Party to the Montreal Protocol on Substances That Deplete the Ozone Layer
International Economic Cooperation
Pakistan does not belong to any Customs Union.

It is a member of the South Asian Association for Regional Cooperation (SAARC)

Pakistan has signed Bilateral Investment Treaties (BITs) with nearly 40 countries. It has also signed ‘Double Taxation Agreements’ with nearly 50 countries.

The country has signed a trade agreement with 21 other countries in the São Paulo Round of the Global System of Trade Preferences among Developing Countries (GSTP).

For more details, visit:

Pakistani Government

Pakistani state

Federal Board of Revenue

Non Tariff Barriers
According to the Trade Policy-2006 of Pakistan, the import of 30 items is banned into the country. This ban is based on religious, environmental, security, and health issues.

Moreover the government reserves the power to grant sector-specific duty exemptions, concessions, and protections under Statutory Regulatory Orders (SROs), though the use of SROs has decreased during recent years.

For more details, visit:

Central Board of Revenue

Customs Duties and Taxes on Imports
Customs duties in Pakistan are levied on ad-valorem basis. The maximum customs duty is 25%. In addition to the customs duty, the government charges 15% sales tax on the duty paid value of a variety of goods imported into the country. Customs duty and other charges are payable in rupees. For more details, visit: Pakistan Customs

The WTO gives a sheet summarizing the Customs tariffs of the country



Customs Classification
The Customs duty in Pakistan is based on the International Harmonized System.
Import Procedures

The following documents are required for imports:

  1. Bill of lading;
  2. Invoices;
  3. Packing list;
  4. Certificate of origin;
  5. Copies of letters of credit (triplicate); and
  6. Insurance certificates.
For more details on import procedures, please visit: Pakistan Customs
Importing Samples

Government of Pakistan allows duty-free import of samples (not for commercial use) provided a bank guarantee or indemnity bond is provided to Customs to ensure that the items will be returned.

The same is applicable to the re-export of goods; but with a minimum value-addition of 2.5% over their FOB price.

 
 
For Further Information
Pakistan Customs
Asia Trade Hub

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Reaching the Consumers

Marketing opportunities

Consumer Profile
After a decade and a half of steady growth, Pakistan's GDP per capita has seen its first decline in years: USD 1,260 in 2020 (IMF), ranking somewhere between Bangladesh and Afghanistan. The population is booming with youth aged 0-24 accounting for 55.31% of the total in 2020 and a net growth rate of 1.99% in 2021 (CIA World Factbook estimations).
While the income inequality is relatively low compared to its region (Gini index score of 33.5 points, 154th worldwide - United Nations Development Programme, latest data available), Pakistan offers a wide range of consumer markets, owing to its large population (over 216 million, fifth-largest in the world - World Bank, latest data available).
Pakistani consumers are now becoming more and more brand conscious. This trend is generating demand for some products that were previously unknown in the country, particularly in sectors like apparel and household consumer durable items.
Despite increases in wages, Pakistani consumers continue to spend an important share of their income on basic needs such as food (39.5% of consumer expenditures) (Economic Research Service of the United States Department of Agriculture, latest data available).
Consumer Behaviour
Pakistani consumer is traditionally price-sensitive owing to their general low income; however, household wealth has been growing steadily in recent years (+18.3% between 2015 and 2019 - HIES, latest data available) and the burgeoning middle class is among the top 20 largest in the world (Credit Suisse Global Wealth Report, latest data available). Consumer confidence has been boosted to a great extent by improvements in political stability and security conditions. Consumers have more disposable income, which they spend increasingly on holiday and electronics.
Consumers Associations
Consumer Association of Pakistan
Main Advertising Agencies
Time n Space Media
Synergy Dentsu
Adcom
Adsells

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Distributing a Product

Evolution of the Sector
Pakistan’s retail scene faces the longest haul towards modernization. Planet Retail estimates that only around 8,4% of the country’s grocery retail sales are generated by modern businesses. This should grow to just 9,0% by 2020. Modern retail infrastructure in Pakistan is, thus, limited to the largest cities such as Karachi, Lahore, Rawalpindi/Islamabad and Faisalabad.

On a national level hypermarkets and superstores account for far less than 2% of national food retail sales. However, the fact that there is already a significantly-sized consumer market available for retail investors is shown by the 30 million people who live in Pakistan’s 10 largest cities alone. In the grocery arena, key players include neighborhood store giant Utility Stores at the retail end and Metro Group at the wholesale end of the market. In convenience store retailing, decent petrol station networks are already operated by western giants Shell and Chevron (Caltex), as well as domestic operator Pakistan State Oil.
Utility Stores, Pakistan’s undisputed grocery market leader, concentrates on neighborhood stores. The Islamabad-based company continues to be fully-owned by the government and now operates just over 6,000 outlets.
Germany-based Metro Group, as a classical player in global cash and carry, opened its first Pakistan store in late 2007 and has since expanded its network to 9 stores. The company has announced plans to build a network of 20 outlets in the medium term.

In the medium term, retail investment in Pakistan is likely to focus on non-food and foodservice. As for food retail investment, this should emerge on a larger scale once the national food manufacturing base has improved along with the quality of infrastructure (roads, electricity, cool chain, education). Foreign food retail investment will additionally depend on availability of investment capacities from the global multiples. However, this short-term lack of foreign competition in food retailing should enable a protected space for domestic supermarket chains to grow, who will accordingly make interesting partners for international FMCG brands.
Market share

The retail sector in Pakistan is experiencing impressive growth as global brands and outlets enter the market. Local retailers are also extending their activities to compete with their biggest foreign competitors.
There are two types of mass retailers:

  • Pakistani mass retailers:
Retail Sector Organisations
The Federation of Pakistan Chamber of Commerce and Industry
Marketing Association of Pakistan
Ministry of Commerce Pakistan
Economic Affairs Division - Government of Pakistan

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E-commerce

Internet access
In 2018, Pakistan had a population of 200.81 million people, out of which 44.61 million were Internet users, making the penetration rate 22.2%, according to Internet World Stats. Internet penetration is still very limited in Pakistan due to a lack of resources and infrastructure. Low literacy level, economic conditions and cultural resistance are also factors behind low penetration rates. Nevertheless, in recent years the cost of internet subscriptions has been falling considerably, and mobile internet access has been increasing, resulting in overall higher penetration. By March 2017, Pakistan had more than 137 million mobile phone users, according to The Express Tribune. However, only 28% of them used 3G/4G connections in 2017, mainly because telecom operators focus on urban and high-revenue areas. Therefore, remote and rural areas in Pakistan still lack broadband, and a large number of Internet users depend on slow dial-up connections. Still, 3G and 4G networks are slowly reaching those areas, as the government plans on increasing connectivity. According to the 2017 Annual Report released by the Pakistan Telecommunication Authority, there were 18 million smartphone users in the country in 2018. As of July 2018, the most popular browser in Pakistan by market share was Chrome (72.81%), followed by UC Browser (9.78%), Opera (5.17%), Android (3.91%), Safari (2.57%), and Firefox (2.27%). As for search engines, the most popular by far was Google (97.59%), followed by Yahoo (1.42%) and Bing (0.05%).
E-commerce market
Pakistan's e-commerce market size is expected to exceed US$ 1 billion by the end of 2018 due to new online payment merchants and broadband penetration (The Express Tribune). One of the key issues that has limited the development of the Pakistani e-commerce industry has been the lack of credible online payment options in the country. However, the entry of international players in the field is expected to resolve this longstanding growth barrier. According to Euromonitor International, the increasing number of young and urban consumers is driving the internet retailing boom in Pakistan. According to Statista, e-commerce sales amounted to US$ 622 million in 2017, representing 0.34% of the country's retail sales. However, the actual value of e-commerce sales is probably much higher, given that the central bank of Pakistan only took into account payments done through debit or credit cards, which represented a small portion of all transactions. Some leading e-commerce websites in Pakistan are olx.com.pk, daraz.pk, pakwheels.com, zameen.com, and kaymu.pk. Daraz.pk led online retail sales in 2016, with a 13% market share; an online Black Friday Sale that broke sales records in November 2015, aggressive marketing and exclusive distribution rights with international brands were among the key factors behind this growth. Alibaba has just recently entered the Pakistani market, and Amazon is also looking to invest in the country. According to the 2017 Annual Report released by the Pakistan Telecommunication Authority, e-commerce is one of the most important drivers of a digital Pakistan. Therefore, the government has been working on the development of an e-commerce policy framework to regulate and further develop the market in Pakistan. That same report stated that there were 5 million online shoppers in the country in 2017, 2000 e-retailers - out of which around 375 accepted digital payments, and as a result over 90% of transactions were paid by cash upon delivery. Smartphones are the preferred shopping medium among Pakistanis, instead of laptops and desktops. According to Daraz.pk, 76 % of this traffic was from mobiles in 2017. Therefore, the biggest e-commerce players in the country are heavily investing on their apps and mobile friendly websites. Mobile & electronics has been the most popular product category among online shoppers for a few years, responsible for lion's share in sales. However, in 2017, 40% of sales were generated by customers who ordered beauty products, grocery and household items.

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Organizing Goods Transport

Main Useful Means of Transport
By rail: Pakistan Railways provides an important mode of transportation to the farthest corners of the country, catering to the large-scale movement of both freight and people. The railway network in Pakistan extends over 12,634 km.

By Road: The road transport network in Pakistan is relatively outdated (built before 1947 during the British Raj), although new motorways are now being constructed. However it is relatively easy to transport goods by road from one place to another within the country.

By sea: The port of Karachi is the most important and the busiest port in the country. It is administered by Karachi Port Trust (KPT). Other ports include ports of Qasima and that of Gwadar. The Pakistani ports have a strategic location in connecting Central Asian countries and the Gulf countries.

By air: Only those foreign air transport companies which have signed an agreement with Pakistani authorities are authorized to work with or in Pakistan. The Pakistani airports belong to the public sector. The airports of Karachi, Lahore and Islamabad have considerable international activity.

Ports
The Port of Karachi
Port Mohammad Bin Qasim
Port of Gwadar
Airports
International Airport of Karachi
International Airport of Islamabad
International Airport of Lahore
International Airport of Quetta
International Airport of Peshawar
International Airport of Multan
International Airport of Faisalabad
International Airport of Gwadar
Sea Transport Organisations
Ministry of Maritime Affairs
Air Transport Organisations
Pakistan Civil Aviation Authority
Road Transport Organisations
National Highway Authority of Pakistan
Rail Transport Organisations
Ministry of Railways

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Identifying a Supplier

Type of Production

The industrial sector contributes nearly 25% to the GDP.
The major industries are textile production (the biggest earner of foreign exchange), oil refining, metal processing, and cement & fertilizer production.

The automotive industry is one of the emerging industries in Pakistan. There are around 20 automobile/motorcycle manufacturing units in assembling operations.
Further to the privatization of the cement plants, and the recent
boom in the construction industry, cement manufacturing is performing very well.
The pharmaceutical sector with a large presence of the main international corporations is a major player now in the country.
The leather goods industry and, to a limited extent, the metal surgical instruments sector, mostly based in Sialkot, are impressive exporters.

Business Directories

Multi-sector Directories
All.biz - Pakistan - Directory of companies in Pakistan
B2B Pakistan - Pakistan's business directory
B2B Pakistan - Pakistan's business directory
Business List - Pakistan business directory
Businessdirectory.pk - Pakistan business directory
Direct PK - Pakistan local business directory
Look Up - Pakistan's Yellow Pages
Pakistan Yellow Pages - Business directory in Pakistan.
Tuugo.pk - Pakistan business directory
UrduPoint - Pakistan business directory
 

To search directories by industry in Pakistan, check out our service Business Directories.

 
Professional Associations by Sector
25 professional associations listed for Pakistan.
 
Trade Agencies and Their Representations Abroad
Pakistan Federation of Chamber of Commerce
Karachi Chamber of Commerce and Industry (KCCI)
Lahore Chamber of Commerce and Industry (LCCI)
Islamabad Chamber of Commerce and Industry
Rawalpindi Chamber of Commerce and Industry
Sialkot Chamber of Commerce & Industry
Faisalabad Chamber of Commerce and Industry
Gujranwala Chamber of Commerce and Industry
Sarhad Chamber of Commerce & Industry
Contact Your Commercial Representations in Pakistan
Mauritian Embassy in Pakistan
House No 13, Street No 26
Sector F-6/2,
Islamabad, Pakistan
Tel: (92) 302 5550073
Fax: (92) 51 2824 656
Contact the Embassy per Email.
General Professional Associations
Small and Medium Enterprise Development Authority
 
 

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Latest Update: November 2022