KARACHI, March 8: Business community pins high hopes on the new government for announcing incentives in its first budget despite tough tasks lying ahead. These include controlling rising food prices, tackling power and wheat crises and reducing high cost of living of the common man.

The trade associations have started formulating their pre-budget proposals so that these could be submitted to the government before March 31, 2008. The associations, which did not send the proposals, last year, are planning to do so this year.

A senior office-bearer of the Karachi Chamber of Commerce and Industry, who asked not to be named, said many businessmen were watching with interest as to what kind of a coalition is formed and who is appointed as the commerce and finance ministers and what are their party affiliations.

The budget proposals will be framed keeping in view these considerations. However, he said that the industry and trade would definitely get the incentives as this would be the first budget of the new government.

He, however, did not foresee many changes in the economic policies keeping in view the international situation.

Federation of Pakistan Chambers of Commerce and Industry (FPCCI) vice-president Zubair Tufail said that the FPCCI wanted the government to first look at the problems of the common man.

The government should think of providing some sort of incentive, like reducing Rs1,000 in the power bill of low income people or by providing some kind of support of Rs1,000 per month so that they could purchase basic essential items easily.

“This proposal could become a reality if the government takes austerity measures by drastically cutting its unnecessary expenditures and think about the falling living standard of ordinary citizens,” he added.

He was of the view that the industries, some how, could manage good and hard times but common man has been suffering for the last few years owing to rising prices of essential goods, and higher utility bills, etc.

He thought that the next two years would be very tough for the new government in handling power crisis.

He was of the view that the government would provide some incentives to the domestic and export-oriented industries in this budget.

Korangi Association of Trade and Industry chairman Shaikh Fazle Jalil said that the association would send the budget proposals very shortly urging the government to curtail utility charges, and interest rates, and impose tax on stock broking etc.

He said that many businessmen invest in stock markets and property but after getting the profits they do not invest in setting up new industries. The government should check this practice.

Besides, there is a need to encourage setting up industrial parks because a businessman or investor cannot think of purchasing land to open a new unit. In Korangi, he said, the one acre land (facing main road) is available at Rs150 to 160 million, while the price of land inside the industrial area hovers between Rs20 to 50 million.

He said that the new government will face problem in improving the country’s image as currently no foreign buyers are ready to visit Pakistan owing to law and order situation. Besides, the most gigantic task for the new government is to control the sky-rocketing prices of edibles.

Site Association of Industry chairman Nisar Sheikhani was of the view that industries are unlikely to get huge incentives keeping in view the current fragile political and economic situations. He said there were few issues with the Customs, Sales Tax and Income Tax which the association plans to take up.

He said that the government will have to take some drastic steps in tackling power crisis, rising prices and downslide in exports.

“The new government may have to work hard in improving the country’s image so that exporters could get more orders through increased market access,” he added.