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Autoparts manufacturers seek help of Lahore Chamber of Commerce and Industry for revival of dying tractor industry

Lahore, October 31, 2013 (PPI-OT): The Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM) on Thursday sought the help of Lahore Chamber of Commerce and Industry (LCCI) for the revival of dying tractor industry. A seven-member PAAPAM delegation was talking to LCCI President Engineer Sohail Lashari on Thursday. The delegation was led by PAAPAM Chairman Usman Malik and comprised Mumshad Ali, Ahsan Imran, Aga Qasim Raza, Irfan Ahmad, Abdur Razzaq Gauhar and Tariq Nazir.

The PAAPAM Chairman said that the government should immediately reduce the existing 10 per cent GST on tractors with a view to sustain manufacturing growth, which is under serious threat of closure due to gas supply suspension on one hand and long-hours unannounced power load shedding on the other in Punjab.

Usman Malik said that the reduction of sales tax would help put the tractor industry and its allied hundreds of vending units across the country back on track, bringing tractor rates in the reach of small land-holders- a step forward in farm mechanization, maximizing per acre yield.

“If we are to match the per acre horse power of India, we require 800,000 more tractors and if 100,000 tractors are produced each year, it will take us eight years to match farm mechanization of India.” He also urged the government green tractor scheme should immediately be launched keeping in view the tractor production capacity installed in the country.

He said that auto industry is again facing a steep decline in production and any change in Sales Tax regime at this point may backfire, leading to closure of industry. The PAAPAM leader said the reduced GST would continue to increase the sale of tractors and ease the problems being faced by the tractor manufacturers and the farming community, as after the imposition of GST, huge decline in tractors sale were seen. After this decision thousands of employees and their families attached with this sector could also get benefit, he added.

He said that availability of tractors at cheaper prices would also help increase the production of agriculture in the country. Quoting the figures of last year, PAAPAM chairman observed that after cut in tractor production, about 28,000 workers had been rendered jobless while 600 parts vendors stopped their work. According to him, 95 percent tractor parts are locally made, but tractor production was reduced to 25 per cent after levy of general sales tax.

Without the sales tax, the local industry would produce 80,000 to 100,000 tractors that would ensure jobs for thousands of workers, besides increasing mechanization of agricultural farms, the PAPAAM chairman said. Speaking on the occasion, the LCCI President Engineer Sohail Lashari said that the Lahore Chamber of Commerce and Industry would extend all possible help to the auto industry as it is the mother of many industries. “The Ministry of Commerce would be updated on the tractor industry plight for an early action.” He said that the issue of GST would be raised with both the federal and provincial governments to save this strategic industry for the agri economy.

The LCCI President said that the economy would not be able to come out of woods until and unless a collective approach is adopted by all the segments. He also urged the visiting delegates to share their budget related proposals with the LCCI so that the same could be forwarded to the concerned government departments. Talking about the LCCI future plans for the economic revival, the LCCI President said that the Lahore Chamber is planning to prepare Shadow budget for the year 2013-14 and PAAPAM help to this regard would be of utmost importance.

For more information, contact:
Shahid Khalil
Information Department
Lahore Chamber of Commerce and Industry (LCCI)
11-Shahrah-e-Aiwan-e-Tijarat,
Lahore -54000, Pakistan
Tel: +9242 111 222 499
Fax: +92 42 636 8854

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