Pakistan Halal Authority: Taking the First Step

It took the government quite a long time to realize the export potential of this multi-trillion-dollar global Halal product market. By establishing the Pakistan Halal Authority (PHA)—the country's first government legal body addressing the entire Halal industry—Pakistan has increased its chances of becoming a major player in the Halal product market.

For many years, policymakers in Islamabad showed an extreme lack of interest in regulating the Halal export sector. Nonetheless, in the end, it has decided to join the growing number of countries that regulate and discipline the lucrative export industry. The National Assembly finally approved the pending bill to establish the PHA last month, whose task is to officially certify all export products, including meat, food, processed food, cosmetics, soft drinks, pharmaceuticals and cosmetics.

Under this mandate, the PHA will develop long-term strategies and plans for Halal exports, imports and other commerce-related activities. The PHA is also responsible for developing Halal standards, procedures and products that adapt to the national standards body. After the creation of the PHA, it is prohibited to export any item called Halal food that contains a description or representation of a Halal item or product, unless it bears the authority's Halal mark.

Pakistan entered the global Halal market very late, which is why it is still a small player. Currently, the country's share of total Halal exports is close to 5% of world trade. According to a Reuters report, the overall Islamic economy reached 9.5% in 2013 and will reach 10.8% annually by 2019, expected to reach US$3.7 trillion. This constitutes the potential core market in the Halal food and lifestyle sectors.

Currently, the main beneficiary of the PHA is Pakistan's Halal meat industry, because fresh and processed meat are currently the only Halal products exported domestically. It has a ready market, and the industry has lobbied heavily to form a central body that cooperates with the federal government.

According to meat exporters without a Pakistani authority-recognized body, they need to obtain certification from each country they export to, which is not only costly but also problematic. By establishing a body that issues Halal certificates according to OIC-stipulated standards, the government hopes to enter the OIC market, which imports 85% of its food from non-OIC countries such as Brazil, worth about US$4.73 billion.

However, a very few industry insiders have begun to question the leadership of the PHA, which was given to the Ministry of Science and Technology. They believe the ministry has little trade experience or knowledge, especially in the trade of Halal products. They believe the PHA should be a leader in trade and Halal affairs.