Indonesia to restart exporting palm oil to Pakistan

ISLAMABAD: Pakistan will receive two big palm oil shipments soon while eight other cargoes would reach the Karachi Port in the next two weeks, the Ministry of Industries said.

On the instructions of Prime Minister Shehbaz Sharif, Federal Minister for Industries and Production Makhdoom Syed Murtaza Mahmud visited Indonesia from 12-14 June 2022 for edible oil imports as Jakarta had recently banned the export of oil to global market that led to its price hike.

Meanwhile, a tweet from the Prime Minister’s Office said that Pakistan will receive 10 shipments of palm oil from Indonesia till end-June 2022. A total of 2.5m MT of oil will be supplied to Pakistan.

“Shehbaz Sharif has made great strides in supplying edible oil to the people. Brotherly country Indonesia will immediately supply palm oil to Pakistan,” the tweet said, adding that the PM had a telephonic conversation with Indonesian President Joko Widodo on June 10.

Pakistan is the third-largest importer of Indonesian palm oil. In 2021, Pakistan imported 2.78 million tonnes of palm oil from Indonesia. Two shipments of palm oil carrying 30,000 and 27,000MT were to leave for Pakistan Tuesday while another eight shipments were expected to reach Karachi before the end of June 2022.

During his visit to Jakarta, Murtaza Mahmud met with the Indonesian Minister for Trade Muhammad Lutfi, Minister of Industry Agus Gumiwang Kartasasmita, Coordinating Minister of Maritime and Investment Affairs, Luhut Binsar Panjaitan, and Minister of Industries, Agus Gumiwang Kartasasmita. He also held meetings with the representatives of the largest palm oil exporters to Pakistan and the chairman of the Indonesian Palm Oil Association also called on the minister.

Mahmud described the emergency of edible oil in Pakistan and mentioned that Indonesia's decision to ban palm oil exports for a month had affected the stocks of edible oil in Pakistan. Even after the ban had been lifted on 23 May 2022, the exporters are still facing regulatory and logistical bottlenecks. He also urged his Indonesian interlocutor to facilitate the earliest-possible resumption of palm oil to Pakistan by removing the bottlenecks.

The Indonesian minister assured that Indonesia attached great importance to its relations with Pakistan and was ready to ensure an uninterrupted flow of Indonesian palm oil to Pakistan. He further stated that after necessary formalities, the first shipment of palm oil to Pakistan was expected to sail within 24 hours. Both the ministers discussed bilateral economic and trade relations. Minister Mahmud underscored the urgency of bridging the huge trade imbalance between the two countries. The two ministers identified SMEs, agriculture, tourism, industrial joint ventures and other non-traditional sectors as possible areas of collaboration. Minister Lutfi agreed to visit Pakistan to discuss these issues.

During his meeting with Coordination Minister Luhut Binsar Panjaitan who has been assigned by President Jokowi to coordinate local distribution and export of palm oil, Minister Mahmad underscored the need to ensure uninterrupted delivery of the commodity to Pakistan. Luhut promised to make sure that the delivery of palm oil to Pakistan is resumed at the earliest. He further stated that he had directed a steady flow of the commodity in the future.

Minister Mahmud and his Indonesian counterpart, Mr Agus Chumiwang Kartasasmita exchanged views on bilateral cooperation in the industrial sectors, particularly in the production of e-vehicles cell phones, electronics, and agro-based industries. The minister highlighted the potential of investment in Pakistan in various sectors emerging from SEZ and invited the Indonesian businessmen and entrepreneurs to invest in Pakistan.