FAP demands immediate withdrawal of GST on tractors | Pakistan Today

FAP demands immediate withdrawal of GST on tractors

Farmers Association of Pakistan (FAP) President Tariq Bucha said the present government since assuming power in 2008 has failed to take any correct and positive steps for the improvement in Pakistan’s economy despite tall claims and false promises. The most vital sensitive and crucial component of Pakistan’s economy was and still is agriculture with 22 per cent share in GDP. Government policies so far have destroyed organisations like PIA, Pakistan Steel, Pakistan Railways and many others. The recent attempt to kill the farmers and agriculture sector began with following most destructive measures:
a) Stoppage of gas to fertiliser Industry
b) Imposition of GST an agri inputs
c) GST on agriculture machinery i.e. tractors and implements. While government has totally ignored basic components of economic progress to invest and cater for profitable sectors like agriculture, it is a pity that it has also made agriculture meet the same fate as other sectors through the anti farmer policy.
d) Pakistani farmers of which 86 per cent own below 12.5 acres can hardly make both ends meet because of imposition of GST on inputs they would now have to avoid the application of required fertiliser and the use of tractors for cultivation because of its prices swelling beyond the reach of the farmers. In fact FAP members felt that Pakistan face a catastrophic impact on its agriculture share in GDP because of following facts:
a) Very little or practically no increase in output / crop price in relation to the overall average increase of around 33 per cent in cost of production during 2011 (since imposition of GST)
b) Productivity will suffer further because of non affordability of buying tractors whose prices e.g in July – December for a 50 HP tractors were Rs499,000 increasing in March – June to Rs630,000.
c) When approached, one of the manufacturers of tractor revealed that because of phenomenal increase in price of tractors resulting from GST the sales dropped firm around 33,000 units in July – December 2010 to only 12,187 units in July – Dec 11 which shows an overall downward trend of 61 per cent in sales. Accordingly it was anticipated that if this trend continued and GST was not withdrawn as against 70,000 tractors sold last year, only 25,000 units will be sold this year. This trend clearly indicates that farmers have decided against use of tractors because of prohibitive prices and would revert to centuries old stone age cultivation method. FAP members felt that this will result in phenomenal drop in crops production and overall agricultural productivity including that of wheat the most important staple food for Pakistan besides creating serious issue of food security. Moreover, FAP president further said that government at this time feels secure and comfortable because of heavy carryover stocks of wheat but is totally oblivious to the facts pertaining to the productivity of crops like sugarcane cotton, etc. which are essential raw material for sugar and textile industry.