Call for long-term consistent industrial, agriculture policies

Mian Anis' A. Sheikh, president of Multan Chamber of Commerce (MCCI) has stressed the need for introducing long-term consistent industrial, agricultural and auto policies in the country to restore investors' confidence and save foreign exchange and earn substantial revenue. He also called for cutting down rate of inflation and mark-up on industrial as well as agricultural loans.
In a press statement issued here, he said that Auto Industry Development Programme, which is to expire in June 2012, should be extended for another three or five years with the consent of all stakeholders because auto industry is generating substantial government revenue, contributing significantly to country's gross domestic product. It is also saving a huge foreign exchange by import substitution through localisation of parts through transfer of technology to vendors, he added.
Sheikh observed that a consistent long-term policy for the auto industry will create more investment and job opportunities in the industry which already has an investment of over Rs 92 billion and giving employment to 0.4 million people directly. He said that a better policy is meant for addressing the issues like most liberalised used cars imports policy in the region, proposal on tariff rationalisation, under invoicing, mis-declaration in auto parts imports and limited consultation with Original Equipment Manufacturers on free trade agreements, etc. These, he said, are badly hurting the industry.
Localisation is the key factor meant for progress and growth of national economy, however, tariff reduction and used car imports are two major issues of the local manufacturers that must be considered prior to formulation of any policy. Any reduction in duty structure will make local nascent industry uncompetitive, which will lead to complete collapse of the industry, therefore, causing more unemployment.
Similarly, MCCI president maintained that government should monitor misuse of used car policy. Some changes in the policy is required like registration should remain in importers' name for at-least two years, while the policy should be reverted back to three years and one percent depreciation with maximum depreciation cap of 36 percent to discourage abuse of the policy. According to some facts in this regard, a used car importer enjoys 60 percent depreciation allowance while in India, basic duty on used cars is 100 percent with some additional duties and taxes of 32 percent.