PTC Risks Losing Sudan Small-Pack Order

Pakistan Tobacco Co. (PTC) may lose a large order from Sudan if the health ministry continues to drag its feet on the required regulatory approval, reports the Business Recorder.

Sudan has ordered $20.5 million worth of cigarettes, to be delivered in packets of 10 sticks of cigarettes each, from PTC. The sale of such packs is prohibited in Pakistan but allowed in Sudan.

Prime Minister Shehbaz Sharif has granted PTC’s request for an exemption of the small-pack prohibition for exports, but the Ministry of Health has failed to issue the required amendment in the statutory regulatory order.

Due to the delay, Sudan has now started contacting other countries to meet its domestic demand. A PTC official said that if Pakistan does not allow exporting cigarettes in small packets, the order may be shifted to Bangladesh or Indonesia.

PTC has been exporting cigarettes since 2019 and has so far earned $156 million, bringing much-needed hard currency into Pakistan. For the next fiscal year, the company is targeting $60 million in exports.

In the most recent fiscal year, the company paid PKR148 billion in federal excise duty and sales tax.

It’s not the first time PTC has lost business due to the small-pack restrictions. In 2019, the company lost an export order to the Gulf. At that time, the Ministry of Commerce had given permission for exports, but the Ministry of Health withheld approval.