ISLAMABAD: An estimated discrepancy of Rs5.5 trillion has been detected in Pakistan’s trade with China over the past five years due to under-invoicing and exploitation of digital integration gaps at country’s ports.
These loopholes have allowed manipulations of cargo manifests, declarations and tax assessments.
Defence Ministry sources, while referring to the findings of Task Force on Revamping of Maritime Sector, said Pakistan’s port operations are not digitally connected with other countries, leading to massive misdeclarations.
Reportedly, these sources said, the data related to “Trade with China” for the last five years shows differences of Rs5.5 trillion as the digital integration voids are being exploited to manipulate the cargo, manifest and declaration.
The figure of Rs5.5 trillion, it is explained, is extrapolated on the basis of sampling data.
The non-digitalisation of the ports’ processes suppresses the amount of taxes as undervalued prices of goods are declared in many cases.
This practice is common on those goods which are subjected to higher taxes, a source said, adding some other areas being exploited for individual gains by corrupt mafia include misdeclarations, manipulation of harmonised system (HS) Codes and lack of integration of systems.
One of the most important issues identified towards revenue shortfall and pilferage is lack of requisite digital connectivity within ports and with FBR and Customs authorities.
Existing Information and Communication Technology (ICT) infrastructure is found by the Task Force as outdated and poorly aligned with key businesses and support functions, leading to reconciliation errors, weak reporting and minimal contributions towards the core business of port management adversely affecting the maritime economy of the country.
The sources disclosed out of 32 core processes, 11 areas are considered essential for the digitisation of port operation vis-a-vis international best practices, but in the case of KPT and PQA, only four and six are digitised.
The essential 11 areas for digitisation include Vessel and Traffic Management, Cargo and Container Management, Yard and Gate Operations, Resource Allocation and Management, Safety/Security/Emergency Management, Environmental Monitoring and Sustainability, Crew and Passenger Management, Infrastructure and Maintenance, Billing/Invoicing/Financial Operations, Communications and Stakeholders Collaboration and Data & Analysis.
