Karachi, June 15, 2020: Capt. A Moiz Khan, patron-in-chief, North Karachi Association of Trade and Industry (NKATI) and President Naseem Akhtar has lauded for considering NKATI’s proposal for the industrialization and announcement to make industrial raw materials duty free in the federal budget 2020-21.
In a statement, NKATI leaders thanked to Prime Minister Imran Khan, Finance Advisor Abdul Hafeez Sheikh, Minister for Industries & Production Hammad Azhar, Adviser Commerce & Investment Abdul Razak Dawood and termed the move as very important for the revival of industries and new industries set up in the wake of the severe economic crisis in COVID-19 pandemic.
“Overall the budget could not be said to be very good. However, announcement of 2,400 imported industrial raw materials duty-free is a significant step of the government. This will help in getting out from economic crises and will reduce industrial production cost while it will encourage investors”, they said.
“All imported items should be allowed only in CKD by banning finished items for the promotion of industries and that efforts should be made to ensure that 80 percent components are manufactured in the country in 3 years. The main benefit of this is that more industries will be set up and employment will be provided to the people while increasing the country’s declining exports will also be possible”, NKATI leaders demanded.
They further said that raw material means that no finished items should be imported and only unfinished items should be imported in CKD to ensure the production of finished items in the country which would lead to expansion in industries and vast employment opportunities.
Capt. A Moiz Khan and Naseem Akhtar added that Pakistan’s economy is very big and important if the economy is focused in the right direction and steps are taken to reduce the cost of business and industrial production, the country will be on the path of economic growth and will also be a significant increase in tax collections.
They reiterated the demand of the 5 export sectors to restore the zero-rated facility and said that the government did not mention it in the federal budget but we are hopeful that the government will consider this legitimate demand of the exporters as soon as the situation improves and in the coming days, this demand may be addressed in the import and export policy.
“17 percent sales tax levied on export sectors is not government revenue in any case but the government has to repay it after collecting and then the entire tax machinery was busy in the extra work of tax refund. It is better to hire tax staff to collect the revenues.
The FBR tax targets are badly affected due to this while the capital of exporters is stuck with the government”, they added. NKATI leaders opined that COVID-19 pandemic has shaken the strong economies of the world including Pakistan and the situation has reached such a stage that foreign buyers are demanding goods from suppliers on longer borrow which is not possible for Pakistani exporters.
Therefore, the government should give maximum relief to the export sectors to make them competitive in the international markets and restore zero-rated regime for the 5 export sectors so that the industries can resume normal production activities at full capacity.