Home Economics & Business Policy for tax, duty exemptions on agriculture machinery import on cards

Policy for tax, duty exemptions on agriculture machinery import on cards

0
9

ISLAMABABAD: A policy is being finalized for the development of industrial infrastructure development with tax holidays and full duty exemptions on import of agriculture machinery. Syed Naveed Qamar Pakistan’s Federal Minister for Privatization, Investment, Ports, Shipping, Industries & Production stated while delivering his keynote address at Middle East-Pakistan Agriculture & Dairy Forum at Dubai Tuesday.

The Minister said that Pakistan’s economy was still predominantly agrarian in nature. Agriculture accounts for 21.6 % of the GDP and 43.4 % of the total workforce and is the main source of livelihood for 66 % of the country’s population living in rural areas. It contributes substantially to the country’s exports. It also provided raw material to major industries such as textile, sugar, dairy, leather and other agro-based industries as well as market for industrial products, he stated.

There existed a vast scope for investment opportunities in Pakistan’s Dairy and Agriculture Sector, which was one of the most important sectors in our economy and its encouraging potential could be capitalized by enhancing production and value addition as the strategic location of the country provided a framework of export avenues for livestock & related products to the Gulf markets, he added.

He informed that Pakistan was ranked as the 5th largest milk producing country in the world with annual production of over 40 million tonnes. Livestock makes a large contribution to the revenue generated by the agriculture sector. Pakistan has a large livestock resource base and considerable potential for dairy production & export.

Around 96.5% of the milk is coming from the informal channel, that is the local milkman and only 3.5% is processed. The informal markets lack vertical integration. Consequently this presents tremendous investment potential in the dairy sector. Government policy is aimed at private sector led development of the livestock and diary sector.

Mr. Naveed Qamar further stated that Pakistan’s livestock products have a competitive price edge with halal feeding & slaughtering. This provides an opportunity for investment given our proximity to the Arab markets, which are not far from Pakistan and were linked with air and sea routes, he said.

Elucidating the vast investment opportunities in Pakistan’s Dairy sector, the Minister underlined the establishment of the semen production units and termed it a good investment. Business advisory services for livestock are proposed to be introduced. Such a service is neither available in the public nor the private sector. Setting up of livestock business advisory centres providing animal health and artificial insemination services presents a good investment opportunity. Specialized milk collection units can enhance vertical integration in the sector. Related diversification into pharmaceuticals industry (for animal vaccines) was another area, which provided a potential opportunity for investment, Mr. Qamar stated. In his address he informed the participants that Pakistan has a large local market of over 160 million people and among them 100 million was under the age of 25 years of age with a large labour force of 45 million workers.

Highlighting the salient features of Pakistan’s incentive based, investor friendly policies he said Pakistan’s investment policy was the most liberal in the region. Most of our economic sectors are open to FDI where the foreign investors can hold 100% equity. Safety of investment is assured and we have signed Bilateral Investment Treaties (BIT) with many countries worldwide. Government processes and procedures are being streamlined; a number of incentives and facilitation measures are being taken for promoting business activities in Pakistan. These include the network of industrial estates & export processing zones, economic zones with tax holidays, concessional customs duty on import of Plant & Machinery and the unrestricted outward remittances of capital, profits, royalty, technical & franchise fees etc. Special Economic Zones are proposed to be set up in different parts of the country. These steps offer immense opportunities for investment in all major sectors including the diary and agriculture sector.

Pakistan was undergoing significant financial reform process including tax, trade & tariffs, financial sector & capital markets in addition to strengthening the regulatory mechanism. All of these are aimed at promoting de-regulation, investment, transparency in financial operation and good governance with poverty alleviation as the ultimate goal. In view of the policies that the government has adopted, many international companies are now investing in various sectors. A recent study found that MNC’s enjoyed average return on equity of over 30% per annum, he stated.

He added that Pakistan has declared horticulture as one of the priority areas being an important sub sector of the agricultural economy. The horticulture sector has tremendous potential to improve by reducing the yield gap (per hectare) and post harvest losses through better infrastructure and processing facilities. Pakistan is producing large quantities of fruits and vegetables, the bulk of production is marketed locally and significant quantities are wasted because of lack of appropriate facilities. High post harvest losses are mainly on account of insufficient packing/grading and cold storage facilities along with absence of refrigerated transport/containers. After improvement in post harvest management Pakistan will have a large production surplus to substantially increase the exports. The Horticulture sector presents an immense potential and opportunity. Pakistan has a wide range of the basic natural resources like diverse climatic zones, fertile lands, vast plains, and well-established irrigation system, which cater to a range of horticultural crops throughout the year.

Syed Naveed Qamar urged the investors to avail the tremendous available investment opportunities in Pakistan where highly professional, qualified, competent and hard working workforce was also available along with a safe environment and profitable place for future investments and businesses, which reflected investor’s confidence through the performance of the local stock exchange, which has been the strongest performing in Asia during the current year and the second best performing major market in the world.

NO COMMENTS

LEAVE A REPLY

Please enter your comment!
Please enter your name here