ISLAMABAD: The Ministry of Commerce (MoC) is reportedly hesitant about extending subsidy for IDEAS-2024 to be organized by the Ministry of Defence Production (MoDP), saying that it does not support the proposal for 100 % allocation of subsidy to be provided for booking of space and displaying products by the local manufacturers, keeping in view that no such allocation has been made in the budget of the MoC, well-informed sources told Business Recorder.
According to the Commerce Ministry as per provision of the Export Development fund (EDF) Act, its Board has full powers to make expenditure on merit, based on the feasibility of project and export promotion needs of the exporters, trade promotion offices and trade bodies.
The EDF Board in its 74th meeting held in December, 2016 approved funds amounting to Rs 70 million, for the IDEAS event, subject to an undertaking by Ministry of Defence Production that it will not approach EDF Board for financial support in future. However, the funds were not released as the Ministry of Defence Production did not submit the undertaking and requested the Board to abolish this condition.
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As mentioned by MoDP, DEPO had submitted a request for financial support for IDEAS-2024 to EDF in August 2023, without sharing details except rates offered and calculation of 50% subsidy for the space allocated for local enterprises. EDF has requested DEPO to submit the proposal as per required procedure/application form. The matter has, therefore, not been presented to the EDF Board owing to incomplete documentation.
Ministry of Defence Production/DEPO has been requested to submit the complete proposal and documentation/information to the EDF for consideration by its Board and review condition of undertaking.
Ministry of Finance concurred to the proposals contained in the proposal with the condition that requisite expenditure may be undertaken from budgetary allocations available without demand for additional funds.
According to the proposal of MoDP, the 12th International Defense Exhibition and seminar (IDEAS-2024), a biannual event, is scheduled to be held from 19 to 22 November 2024 at Expo Centre, Karachi under the auspices of MoDP. Defence Export Promotion Organization (DEPO), an Executive Department of the MoDP, is responsible to organize and conduct the IDEAS.
The IDEAS, according to Ministry of Defence Production, is recognized as one of the leading international defence exhibitions in the world. All-out support of the Government of Pakistan is instrumental in making IDEAS a success story. Successful conduct oflDEAS-2022 greatly helped to project defence industrial prowess of Pakistan in which 532 (318 foreign and 218 local) exhibitors and 107 delegations participated. Pakistan hosted 73 countries in IDEAS-2022. Number of exhibitors, delegations and visitors has increased over the years.
The invitations for IDEAS-2024 will be extended to over 300 delegations and International Defence Exhibitors from 100 plus countries from across the globe. The invitees will be accommodated/lodged in five star hotels at Karachi, and all out efforts will be made to ensure substantial increase in the participation of private sector.
The security arrangements for IDEAS covering the venue and delegates, have previously been done under the overall supervision of Headquarters (HQ) 5 Corps, Karachi, which integrates the efforts of Military, Rangers and other Law Enforcement Agencies. This time as well the responsibility has been planned to be given to HQ 5 Corps. Ministry of Interior, M/o Defence and Sindh government may be directed to mobilize all their Security and Law Enforcement Agencies/instruments for ensuring adequate security and safety measures for IDEAS-2024 as well. All indirect expenditure incurred will be met under relevant heads of the respective Services/Ministries/Organizations. No additional demand of funds shall be placed on the national exchequer for this purpose.
Ministry of Defence Production argues that equipment and machinery imported by the representatives of foreign/commercial firms for demonstration purposes shall be free of duty and sales tax if imported through Ministry of Commerce or Ministry of Foreign Affairs. As per past practice special exemption from taxes will be required from the FBR for the promotional material/ give away of no commercial use.
To encourage and facilitate enhanced participation by the local manufacturers for booking of space and displaying their products during IDEAS-2024, 100% allocation of demanded amount of subsidy may be provided by the Ministry of Commerce, the sources quoted Ministry of Defence production as saying in its proposal.
For success of IDEAS-2024, cooperation and support are required to be extended by the following Ministries/Agencies, for which necessary instructions/directions are required to be issued by the Office of the Prime Minister: (i) Ministry of Defence (ii) Ministry of Finance (iii) Ministry of Interior (iv) Ministry of Commerce (v) Federal Board of Revenues (vi) Ministry of Foreign Affairs (vii) Ministry of Information, Broadcasting and National Heritage (viii) Ministry of Industries and Production (ix) Ministry of Energy (Power Division) (x) Ministry of Water Resources (xi) Ministry of Communications (xii) Government of Sindh (Karachi Administration).
The sources said the Prime Minister has seen the proposal of Ministry of Defence Production and approved holding of IDEAS -2024 along with the views of Finance Division. Ministries of Defence, Interior and Government of Sindh shall ensure security/safety of IDEAS-2024 and ministries/agencies shall extend cooperation and support for the successful holding of the event.
The Prime Minister has further directed that MoDP shall move a separate case to EDF of Commerce Division regarding subsidy for the space allocated for local enterprises.
Copyright Business Recorder, 2024
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