The tractor sales have increased manifold after reduction of general sales tax (GST) from 16 percent to 5 percent last month, which has made the tractors cheaper by Rs 60,000 to Rs 145,750 according to model and horse power of the tractor, industry sources told Business Recorder.
A senior executive of Millat Tractors Limited (MTL) said that MTL is receiving booking orders in large numbers from the buyers after issuance of the SRO on 3rd February 2012. "The response of the farming community has been very enthusiastic, therefore, the MTL has restarted its second shift in the factory and placed orders for parts and accessories of tractors with its vendors to meet the growing demand of the customers, he added.
He said that if the increase demand continued, the tractor manufacturers may sell 8,000 to 10,000 tractors during this month. The boom in tractor industry will not only boost the agriculture sector but also generate additional opportunities for the auto industry. Convenor Tractor vending industry and former chairman Pakistan Association of Automotive and Accessories Manufacturers (PAAPAM), Malik Mohammad Aslam said that boom would be revived all the closed tractor units which were closed due to slump in tractors sale since March 2011 and after imposition of 16 GST on the zero-rated tractor manufacturing industry.
He said that PAAPAM is motivating its members to re-engage their laid off skilled and semi-skilled workers and start their vending units for tractor parts which are almost 90 percent localised in the country.
Malik said that tractor sales had nose-dived from 300-400 tractors daily now it only sale is 10-20 daily after impose levy of 16 percent GST. The two premier tractor assemblers, ie, Millat and Al-Ghazi tractors had closed down their assembly lines during the second half of FY 2011-12 after fall in tractor sales. Pakistan produces about nearly 75,000 tractors indigenously with over 90 percent components coming from the local vending industry, he said.
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