Mixed reactions

Though the detailed budget documents are yet to be examined by the people, mixed reactions are given about the 5th budget of the present government. As no major incentives are announced for agricultural sector, exporters, traders and growers, the budget for the financial year 2012-2013 could not be called a balanced budget.
Talking to Business Recorder, Mohsin Aziz, Chairman, All Pakistan Textile Mills Association (APTMA) said that under the present circumstances of inflation, huge borrowings from banks, deficit and energy issues, the budget presented by the government was almost a balanced budget.
It was encouraging that the government has accepted some of proposals made by APTMA as the turnover, and 20 percent income tax credit on specified value of investment were good signs in the budget. According to the budget document, "The Ministry of Textile Industry has recommended new tariff headings for facilitation of textile industry and to update national tariff in accordance with international best practices. These headings are accordingly being created in Tariff."
However, Mohsin said that the government, as it was proposed by the association, should also reduce the Final Liability from the existing 1 percent in the category of Income Tax in order to strengthen exports.
Talking about the energy crisis in the country, he said, nothing was mentioned in the budget to resolve the ongoing severe energy crisis in the country. Government should reduce the cost of production at exiting electricity producing units, specially the Independent Power Producers (IPPs) where, besides providing required fuel, at least 90 percent energy efficiency was needed to be ensured to avoid the burden of huge subsidies.
Commenting on the budget, Waheed Ahmed, a leading exporter of fruit and vegetable, said the government had largely neglected the agriculture sector, which was the backbone of the country. The proposals forwarded by Pakistan Fruit Exporters, Importers and Merchant Association were not included in the budget proving that the government was still reluctant to develop important sector. The research and development projects, which were needed to improve quality and varieties of agricultural products, were also yet to be introduced without which the country was feared to be an importing country of vegetable and fruits.
Another demand of the fruit exporter for exempting the value-added products and locally produced products like pulp and juices from duties were also not accepted by the concerned authority as it did not reflect in the budget, he added.
Taufiq Ahmed Khan, an exporter of rice said the budget was no more than the completion of formalities as it gave no solution to the energy crisis, circular debt issue, high interest rate and others. Besides, no major incentives had been announced to enhance foreign exchange earnings through supporting the local traders and exporters. He predicted that the budget would encourage and supports more imports rather than exports.
However, the reforms in custom, reduction in duties and facilitation for import of machineries were encouraging elements of the budget. According to Sanaullah Khan, a leading exporter of marble and granite, the budget lacks any measure or incentive to the marble sector, which has lost many lucrative markets of Europe so far because of negligence on the part of concerned authorities. Nothing has been made for value addition of the highly valued product which has now confined to the markets of Middle East and China. Government has already stopped giving the rebate facility to the sector. Raw materials are largely being exported to China.