KARACHI, June 9: Industrialists and businessmen offered divergent views on the budget 2007-08 as some termed it a politically motivated document focusing more on controlling food inflation and steps to promote agriculture to win the masses support in October election, while others see no major incentives for industries and the export sector.
Chairman Korangi Association of Trade and Industry (Kati), Masood Naqi said the government had not given any major incentives to the industries and promotion of export.
“The budget lacks any measures for reducing the cost of production, which the industries had been clamouring for years,” he said adding that incentives to the filament yarn sector will benefit only four to five units instead of taking care of the whole textile sector.
He said the import duty on textile machinery had not been reduced to zero while other sectors had been given benefits. “Budget reflects political direction of the government thus making emphasis on farm related incentives,” he said.
President Karachi Chamber of Commerce and Industry (KCCI) Majyd Aziz termed the budget as “progressive”, which will give impetus to move forward.”
“The government has addressed the issue of food inflation this year but it is confined only to the utility stores,” he said adding that opening of 5,000 utility stores will take enough time. To some extent, the budget can be termed as nation friendly, he added.
Former chairman Site Association of Industry Ameen Bandukda described the document as “an election budget” flooded with populist measures. The government had tried to give relief to the general public by providing kitchen items at subsidised rates at the utility stores, which is not a commendable measure.
However, he said that like last year very few people would benefit from the relief provided through the utility stores and a vast majority, which relies on purchasing items at the regular retail shops, will be deprived of the relief.
Ameen said the budget had provided relief to the agriculture sector, which is good as it employs 60 per cent of the country’s population. “The budget lacks incentives or package aimed at cutting cost of production for the existing industries,” he said adding that the export-related industries even the textile sector had not been given any major relief.
Making withholding tax on export at one per cent from the previous 0.75 to 1.5 per cent for various sectors will not make any difference. No measures had been announced to handle the burgeoning trade deficit, which will touch $12 billion by the end of current fiscal.
Chairman F.B. Area Association of Trade and Industry (FBATI) Masroor Ahmed Alvi said that the budget looked quite balanced touching some sectors of export but lacked incentives for the industrial sector, especially the infrastructure development. However, the government has avoided imposing fresh taxes and duties on the industry.
The budgetary measures were mainly studded with incentives for the common man like increasing the salary and relief in prices at the utility stores.
